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

To: John May who wrote (1047)	12/19/1997 9:10:00 AM
From: Oeconomicus	Read Replies (1) \| Respond to of 164684

John, you either have a very odd definition of "quarter-to-quarter" or a very unreliable calculator. Quarter-to-quarter means from one quarter to the next, i.e. the change from Q3 to Q4, while year-to-year is used to indicate a comparison to the same period last year. In this case, $50mm of revenue would represent a 488% increase over last year's 4th qtr, but only a 32% qtr-to-qtr increase. That, IMO, would be a disappointment (not to me since I hold puts, but should be to the longs). The reasoning is simple. If Internet bookselling is the booming business that many agrue it to be, and if AMZN is growing 100% p.a. anyway (to hit $1 billion in 2000 they must), one should expect this year's 4th qtr to represent a bigger portion of full year sales than seasonality alone would suggest. In other words, with growth this fast the 4th qtr should be big regardless of seasonality. Then consider that this is a seasonal business. B&N did 36% of their revenue last year in the Nov-Jan qtr. For AMZN, a $50mm revenue figure would give them $132mm for the year and the 4th qtr would represent 38% of the total, not enough to prove anything more than seasonality. 50% qtr-to-qtr growth, resulting in $57mm of revenue, would bring the qtr to 41% of the full year. That's better, but is it good enough? The point, however, may be moot. The market may not give us a chance to be disappointed in late January. This stock, like most others, may be sent to the dog house much sooner, perhaps today considering overnight developments. Regards, Bob