THIS SCAM................CRASH AND BURN............ROAD MAP NEXT..65<35 2010
Earning boosted mostly by reducing tax withhold 25-Oct-09 03:57 pm First, from corporate tax table we know that Amazon should pay 35% income tax (you can search for corporate income tax on the internet).
From amzn 10Q we know that earning is 262M before tax.
The correct amount of tax should be: 262M x 0.35 = 91.7M.
Actual withhold is only 60M (from 10Q).
In fact they withheld 59M Q3 last year when the earning was much lower.
The difference between the amount they should pay and actaully put aside is: 91.7M - 60M = 31.7M.
The current net income is 199M, which is 0.45/share.
If we reduce the amount by 31.7M, the earning will be: 0.38/share (7 cents less).
Of course, they also used the trick of delaying payments to suppliers. That could easily be another 0.05/share.
Even if we ignore the delay payment, the actually beat is only 15% ( (0.38-0.33)/0.33 ). It is still reasonable but much less than the 36.4% as calculated using 0.45/share.