Re:Jeff Bezos’ letter to shareholders
by taneq on Friday April 08, 2016 @01:01AM
(#11452654)
This seems like a huge distinction that people don't make often enough with high-performing, fast-growing companies. You see it with Tesla, too, when people claim that the Model S is "sold at a loss", ignoring the fact that a large part of the company's current expenditure is in setting up huge new factories.
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Bad example. New factory is an asset, not an expense. Therefore it will have little impact on profitability.
The AWS data centres aren't an asset?
I'd have thought comparing funding expanding Amazon's data centre capacity from revenue is very comparable to Tesla building out it's manufacturing capability the same way.
The DCs are assets with 5-20 year lifespans but the servers depreciate over 3-5 years.
Amazon has also been doing a bunch of capital lease shenanigans so they could expand AWS without having to report GAAP losses over the last few years.