Shopify reported great results if anyone is interested. Like revenues up 89%.
http://seekingalpha.com/pr/16654210-shopify-announces-third-…
9 Likes
I just realized that Shopify purposely spends just over revenue to have a tiny loss of 1% or 2% each quarter so that they can keep grabbing greenfield market share. They know that if they ever report a profit, even a penny, everyone will expect them to limit expenses to make more and more profit each quarter, while they want to keep grabbing market share.
Saul
5 Likes
I just realized that Shopify purposely spends just over revenue to have a tiny loss of 1% or 2% each quarter so that they can keep grabbing greenfield market share. They know that if they ever report a profit, even a penny, everyone will expect them to limit expenses to make more and more profit each quarter, while they want to keep grabbing market share.
And have to pay taxes on said profit weakening their opportunity to grow. Bezos also does not like to pay the piper in lieu of further investment.
A.J.
3 Likes
I’m starting to get it. As long as you plow your cash flow into growth/increased market share, you don’t need to show a profit to please the market. And this is also the secret to Amazon. The idea is that this will eventually lead to huge profits and a huge competitive advantage.