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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Oeconomicus who wrote (130311)	8/21/2001 11:13:16 PM
From: Glenn D. Rudolph	Respond to of 164684

"If you see the words ``pro forma'' on an earnings report, watch out. The term refers to a constantly changing series of accounting techniques — all legal — designed to make a company look better, and it's the hottest smoke screen on Wall Street right now. By using pro-forma methods in Amazon.com's (NASDAQ:AMZN - news) first-quarter earnings release, for example, CFO Warren Jenson managed to exclude millions of dollars in expenses Amazon paid out during that period, making the quarter look better than it really was. Amazon and Computer Associates (NYSE:CA - news), among others, have even convinced many Wall Street analysts to accept the numbers as gospel. How does it work? Generally, pro forma doesn't take into account interest expense, a real cash expense every quarter, and discounts the impact of earlier company acquisitions and capital spending. Using it, Amazon reported a ``pro-forma net loss'' of $76 million. Without it — and using generally accepted accounting rules — Amazon posted a net loss of $234 million. If you want to see how a company really performed in a quarter, go to its ``cash flow from operations'' line on the quarterly cash-flow statement. That number can't be doctored. "