[hncommenter13]

Point 1. Yes, low margin/cash-generative businesses exist, like grocery stores and well, pretty much all of hardline (and much softline) retail. AMZN has not yet generated much profit or much distributable cash flow, relative to their revenue scale (and normalizing their expense base, for things like leases and capitalized software).

My point regarding Walmart was that, even with many of the historical expenses (like trucks) that they no longer bear, they were still more profitable throughout their history than Amazon has ever been. Why?

Point 2. I don't think we disagree, as I'm referring to the long term, not the short term. In most circumstances, a business can't be both unprofitable and cash-flow positive indefinitely, unless there is something very strange happening with the accounting (like unusual tax losses a la GE Capital).

Profits and free cash flow can and do diverge for short periods in the company's lifecycle, but they ultimately must converge in terms of sign/direction.

[hef19898]

over the whole life cycle of a company, ok. Not on the exact mumbers but wether wether profits and cash flow are positive or negative. Chancea are that in the worst case the short term effects already killed the company in question, though.

Regarding Amazon, they are profitable enough. Cool thimg is they are building the fullfillment centers by the dozens, payed from free cash flow. And thats pretty amazing I think. But you are right, in the long run Amazon will most likly hit a growzh cieling. When they do they will have to changw strategy.