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  • nematode_speculator nematode_speculator Jul 22, 2002 10:50 PM Flag

    AMZN's Huge foreign exchanbge losses!

    Maybe some of you recall that the one cent a share GAAP profit that AMZN was able to report in the 4Q of '01 was attributable entirely to its reported $20 million "gain" on the huge euro denominated debt which AMZN so prudently borrowed a couple of years back. It seems that the Euro had, at the time, a downtick against the dollar enabling our friends at Amazon to book a $20 million profit. Some of you may have noticed that since then our precious dollar has gone decidely south against the European Euro benchmark. So now AMZN faces as much as a $100 million loss based on the same debt. The only question is if the accounting meisters at AMZN choose to take the loss in Q2 or wait until the end of the year. I guess it really doesn't matter anyway since AMZN has little likelyhood of actually paying off the $690 million in Euro denomintated debt regardless.

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    • I did not know the source of that $15M+ other gain reported in the Dec 2001 qtr. thanks for that information.

      Also people should be aware that Amazon also recorded $15M+ excess shipping revenuess over fufillment charges in that qtr. the only time that has happen, and based on cuts to billing for shipping that have been annouced not likely to happen again.

      So that would result in $31M one time revenue in Dec/2001 qtr that is not repeated.

      The gaap loss could be big this time. Ofcourse Amzn will only talk about EBITA and proforma Gross profit.

      You do not need to know that it needs another $4B plus in sales just to meet its interest expense per year.

      You do not need to know that it needs another $12B in annual sales to meet the $396M in stock options benefit realized by the executives (not you the little investors)

      Can you say Oink! Oink!

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