As the old saying goes, “It takes money to make money” and that seems to be the philosophy that Jeff Bezos is using to lead Amazon to record losses. The internet retailer posted it’s third quarter financials, and the company appears to be losing money hand over fist. Amazon isn’t losing money because it can’t sell products, it is losing the money because it is spending large amounts of money to grow and to reach new markets with new products. The amount of money that they are losing is enough to have many investors worried, and profits don’t appear to be in the future for Q4 either.
Bezos Leads Amazon To $12 Billion Quarterly Loss
Typically the increased holiday spending would boost a companies sales in the 4th Quarter and help generate some profit. Sadly, Amazon is still projected to out-spend themselves even in the 4th quarter of 2014. Profits may not even be in the forecast for 2015, but devoted investors are holding on to hope that the figures will turn around. If Jeff Bezos’ plan does eventually pay off, then Amazon will be poised to compete in more markets with more products. Unfortunately their first foray into the smartphone business was a complete flop with their Amazon Fire Phone. Even giving Fire Phone owners a free subscription to Amazon’s premium Prime service was not enough to sway consumers away from their other devices.
Logic might tell you that if a CEO led a company to lose almost 1/3 of it’s value in one year, that they would be quickly handed a pink slip. Amazon seems to be sticking with Jeff Bezos at this point, but it is uncertain how much longer the investors and employees will buy into his big vision to grow the company. Bezos had once been praised for helping lead Amazon to become the largest online retailer in the world, but even he had said that someone would come along and be the new next best thing.
Bezos Leads Amazon To $12 Billion Quarterly Loss.