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

To: Bill Harmond who wrote (12367)	8/2/1998 9:05:00 PM
From: Glenn D. Rudolph	Read Replies (1) \| Respond to of 164684

Your first three points don't bother me. Gross margins have been increasing. I don't understand the third point. My third point was that BKS out bid AMZN to be the exclusive bookseller on AOL. Glenn

To: Bill Harmond who wrote (12367)	8/3/1998 2:03:00 AM
From: Rob S.	Read Replies (1) \| Respond to of 164684

Gross margins have hardly been increasing. So they moved from 22% to 23%, that can hardly be characterized as an increase. Expenses increased more than gross margins. Sales and Marketing expenses went up a percent and G & A went up about a point and a half. Gross margins are 23% and S & M run 22%. That leaves a whopping 1% to pay for all the other expenses of running the company and paying off the large junk bond debt. Sure some of the S & M can eventually be reduced, but not by that much. A lot of that is needed to continuously maintain the customer base and a significant part of it goes out to associates whom it would be a strategic blunder to cut back too much. In addition, Amazon.com must put in warehouse space and inventory just like the ones their major competitors already have paid for. They now have to take on the expenses of competing with the big boys. Poof! - there goes those dreamed of profits.