Things keep getting better for the online retail bellwether left for dead by the Street a little more than a year ago.
Shareholders don't need to be reminded of Amazon's
Think about it. What did the cynics argue about back then? That Amazon's low-price strategy would put it out of business? Well, it has survived and done that one better by making free shipping a permanent fixture. That Amazon was a debt-laden, money-scorching disaster? Well, it produced $135 million in free cash flow in 2002. That Amazon's days of growth were numbered? Well, it will deliver pro forma profits of $0.27 a share and is looking for sales to grow by at least 15% this year.
Yes, we can always scold a company for its liberal definition of "pro forma," but it's hard to argue with Amazon's 2002 free cash flow and the fact that it reported an actual profit -- all expenses considered -- over the holidays. Fourth-quarter sales grew by 28% to hit a healthy $1.43 billion.
It's time to get real. The dot-com dream of fat margins in e-tail, given the operating efficiencies and lack of local operating overhead, may never materialize. Amazon will play it razor-thin with free shipping and low prices -- the only two proven tonics to grow sales online. With Wal-Mart
The upside may be capped, but naysayers have to concede that Amazon won't fall prey to spontaneous combustion. It's here -- for keeps.