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> We collectively need to get away from the idea that the only valid fiduciary duty for a for-profit organization is to make profit for their shareholders instead of creating value for humanity.

The idea is not new, and conglomerates have been around for quite a bit now, with most prominent example being Berkshire Hathaway. Take the profits of a textile company, reinvest them in a new line of business, take the profits from that line of business, reinvest it into a new one.

>Anyone who has invested in Amazon has seen an amazing unprecedented ride upward

Only if they sell to realize those gains, and that can only occur if they can find a buyer who has an even greater expectation of profit in the future.

This concept seems to elude people, but the value of a company that never makes a profit is precisely $0.

Amazon makes a profit, it just invests all of it in itself, returning you a more valuable stock instead of a dividend. Investors let them do it because the investment made with the profit is worth more than the cash would be.

Even with all that, the value of a company that doesn't turn a profit isn't 0, it's the value of it's assets, and Amazon has a lot of those.

>the value of a company that doesn't turn a profit isn't 0, it's the value of it's assets

Touche. They also have liabilities.

I suppose we could be even more precise and say the price is $0 above the expected value of the net assets at the time of liquidation. But my point stands.

Well go and try a hostile take over of amazon where you purchase 100% of the stocks for $1. Given it's worth $0, $1 is infinitely more than they are expecting.

Or admit that your point is absurd.

At least in the United States, the dividends are taxed twice - first at the corporate tax level, then at dividend recipient's individual tax level. The nature of the taxation to the recipient is involuntary.

Selling the stock and being taxed on capital gains is a voluntary act that can be planned for accordingly. A company with zero profit also owes zero taxes at the corporate tax level, which makes reinvestments and stock buybacks a more efficient value distribution strategy.

This concept seems to elude people, but the value of a company that never makes a profit is precisely $0.

As others have stated profits = revenue - expenses. In this case they are positive on the right hand, even if slightly, so they are in fact making profits.

Your time horizon is also wrong and assumes that there needs to be a singular point where the top level goal becomes making profit, rather than profit being a byproduct of a top level goal of adding value.

I also disagree with your assertion that value comes solely from profit.

>Your time horizon is also wrong and assumes that there needs to be a singular point where the top level goal becomes making profit

The top level goal is to provide an adequate return to shareholders. Shareholders (of which I am one) allow massive re-investment with the expectation that net earnings in the future will increase.

If you purchase ownership in Amazon (or any other company) for any reason other than to earn a share of their income, that's your prerogative. But you are in a very small minority.

Suppose Amazon were taking all of the profit they pile into capex today, and put cash in the bank. Do you think your share of a growing pile of cash is worthless?

Apparently that's how the stock market values Apple's cash position.

At no point was anyone suggesting that the purpose of Amazon is to tickle Bezos' fancy, and it would require a painfully literal reading of the article in order to think that's what the author was doing.

Perhaps I am dense but how else could you possibly interpret the quote that I cited?

Suggesting - even if lightly - that Bezos is running Amazon for "fun" and as a "lifestyle business", especially in the light of the great analysis done above it, indicates that the author looks at any business that has very long term goals as inferior to those who are solely focused on turning profits back to shareholders.

To paraphrase, "this prompts the suggestion that X is the case. However, it is not". It's a rhetorical question.

You've contradicted yourself there. If Amazon's stock price is doing well, this is evidence that they are creating value for shareholders.

That was exactly my point.

The latter portion of the post was not specifically applicable to Amazon, but was refuting the author's point of view.

oh ok, two separate issue then I guess.

Amazon is making substantial profit, but not taxable profit: it takes the profit in warehouses rather than cash.