I can't help but think that some day this is going to make a classic HBS case study...no matter how it turns out. (I also couldn't help but note that several alleged "financial" news outlets confused the 9 cent per share loss and reported it as positive 9 cents per share earnings - so much for reading comprehension among financial journalists).
In the meantime can someone explain to this mystified observer exactly how this is supposed to work?
"...After the close Thursday, Amazon.com posted a quarterly loss of $41 million, or nine cents per share, matching analyst expectations. Revenue jumped 24 per cent $17.09 billion against expectations of $16.76 billion and its stock surged US$31.18, or 9.39 per cent, to $363.39..."
Here's the first part of the Amazon earnings press release:
SEATTLE--(BUSINESS WIRE)--Oct. 24, 2013-- Amazon.com Inc. (NASDAQ:AMZN) today announced financial results for its third quarter ended September 30, 2013.
Operating cash flow increased 48% to $4.98 billion for the trailing twelve months, compared with $3.37 billion for the trailing twelve months ended September 30, 2012. Free cash flow decreased 63% to $388 million for the trailing twelve months, compared with $1.06 billion for the trailing twelve months ended September 30, 2012. Free cash flow for the trailing twelve months ended September 30, 2013 includes fourth quarter 2012 cash outflows for purchases of corporate office space and property in Seattle, Washington, of $1.4 billion.
Common shares outstanding plus shares underlying stock-based awards totaled 475 million on September 30, 2013, compared with 469 million one year ago.
Net sales increased 24% to $17.09 billion in the third quarter, compared with $13.81 billion in third quarter 2012. Excluding the $332 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales grew 26% compared with third quarter 2012.
Operating loss was $25 million in the third quarter, compared with an operating loss of $28 million in third quarter 2012. The unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter on operating loss was $7 million.
Net loss was $41 million in the third quarter, or $0.09 per diluted share, compared with a net loss of $274 million, or $0.60 per diluted share, in third quarter 2012. The third quarter 2012 includes a loss of $169 million, or $0.37 per diluted share, related to our equity-method share of the losses reported by LivingSocial, primarily attributable to its impairment charge of certain assets, including goodwill...