Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Ken Pomaranski who wrote (2075)	3/9/1998 11:20:00 PM
From: Ken Pomaranski	Read Replies (2) \| Respond to of 164684

A little tidbit: (from last quarter) AMZN nets 20% of sales. (20% Gross Margins) 3% sales = general / administrative expenses 7% sales = product development. 25%(!!) sales = advertising. Basically, the company is fairly profitable if advertising is cut. Also, the bears who claim AMZN can't make money selling books are blowing smoke. Now, one could argue that advertising is basically a fixed cost, and will decrease (as a percentage) as revenues explode. Also, one could argue that once AMZN has total hold of the internet, they can back off on advertising. I'll tell you one thing, when AMZN generates 1.2 billion in revenues, they will not be spending 270 million in advertising! This rivals the 'big, big boys'. I started working some numbers on excel. very interesting... I'll post more details once I double check some of the numbers against other retail companies... kp