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Romenesko: Bezos buys Washington Post for $250 million

Discussion in 'Journalism topics only' started by Moderator1, Aug 5, 2013.

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  1. Songbird

    Songbird Well-Known Member

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    Last edited by a moderator: Dec 15, 2014
    Songbird, Aug 6, 2013
    #25
  2. wicked

    wicked Well-Known Member

    Except that newspapers in major markets haven't had paperboys for 20 years.
     
    wicked, Aug 6, 2013
    #26
  3. Michael_ Gee

    Michael_ Gee Well-Known Member

    I agree with Ragu. It is conceivable Henry bought the Globe as a civic benefactor. But it's impossible to think Bezos bought the Post unless he has some idea, however vague, of making money off the paper. He did buy low, and that's 50 percent of turning a profit on an investment.
     
    Michael_ Gee, Aug 6, 2013
    #27
  4. LongTimeListener

    LongTimeListener Well-Known Member

    This could be very good for the Post and any other paper he buys. One thing about Bezos, he believes in doing the thing right. For many consecutive quarters, Amazon has posted disappointing earnings -- sometimes even losses -- as they pour resources into setting up their cloud computing offering. But he has always explained that he's doing it right so he doesn't have to do it over, and he has been bulletproof in the stock market so far.
     
    LongTimeListener, Aug 6, 2013
    #28
  5. Songbird

    Songbird Well-Known Member

    Unless I read it incorrectly, didn't Amazon post a $22 billion profit during the last holiday season?
     
    Songbird, Aug 6, 2013
    #29
  6. YankeeFan

    YankeeFan Well-Known Member

    Did this purchase -- unlike the Globe's -- include the pension liabilities?

    Bezos is obviously very rich, but the price isn't "low" if it loses a ton of money every year. And, you can't compare it's valuation to something like BuzzFeed because the costs are so different.

    I'm sure Bezoa will be patient in waiting for profits to emerge, but will his patience be rewarded? Can it ever make money again?
     
    YankeeFan, Aug 6, 2013
    #30
  7. The Big Ragu

    The Big Ragu Moderator Staff Member

    Not sure how their holiday season played into first quarter earnings, but as a publicly-traded company, Amazon is interesting.

    It reported second quarter earnings last week, and even though revenues were in line, it actually showed a net loss instead of a profit, taking Wall Street by surprise.

    That is because rather than standing still or taking a short-term approach to profits, which a lot of other companies have in this low-growth environment--Amazon has been spending. It is one of the few companies of that size out there spending.

    Spending on technology, buying content companies, etc. It spent close to $1.6 billion in the quarter, which is why even though revenues were in line with estimates, the company lost money. Amazon is also hiring -- again, one of the few companies hiring with any scale. It announced a week or two ago that it was going to add several thousand full-time warehouse employees.

    It's undoubtedly Bezos' influence. He takes a long-term approach to running a business, which bodes well for the Wash Post -- even if it is going to probably mean a lot of disruption for people who have gotten used to things the way they are. With Amazon, he's willing to sacrifice profit margins and earnings today (which is really hard to sell to shareholders) in order to find new opportunities and expand market share.

    I actually think Amazon's stock is overpriced -- but I tend to think most stocks are overpriced. If you buy Amazon at these valuations, you are basically putting your trust in Jeff Bezos' ability to invest for the future. I don't love blind bets like that, but if I had to place that kind of blind bet, he's not a bad guy to do it on.
     
    The Big Ragu, Aug 6, 2013
    #31
  8. YankeeFan

    YankeeFan Well-Known Member

    How/when did he end up with such vast personal wealth given this strategy?

    Did he cash out a whole bunch of stock at once, has he consistently sold some over time? How much of his wealth is still tied up in Amazon stock?

    Sorry. Don't mean to ask you a bunch of questions I could probably find the answers to online, but you seem well informed.
     
    YankeeFan, Aug 6, 2013
    #32
  9. The Big Ragu

    The Big Ragu Moderator Staff Member

    Hmm. Bezos is worth more than $27 billion, if you believe Bloomberg's estimate. He has a 19 percent stake in Amazon, which has increased in value by several billion dollars just in the last few months.

    In terms of his liquidity, yeah, he has sold some Amazon stock since it went public. At least $2 billion worth. Most of it is invested in his space exploration company. But I am sure he has enough money liquid to buy a toy for $250 mil, and not have to eat Ramen Noodles. :)
     
    The Big Ragu, Aug 6, 2013
    #33
  10. Michael_ Gee

    Michael_ Gee Well-Known Member

    He sold about $185 million worth of Amazon stock last month.
     
    Michael_ Gee, Aug 6, 2013
    #34
  11. jackfinarelli

    jackfinarelli Well-Known Member

    Absolutely right!
     
    jackfinarelli, Aug 6, 2013
    #35
  12. Dick Whitman

    Dick Whitman Well-Known Member

    I was reading Forbes or Entrepreneur Magazine or some such business rag one day at the gym a few months ago, and they did a "Where are they now?" on a mid-'90s cover in which they had assembled all of these dotcom future gajillionaires for a photo shoot. More of them had been to jail than had cashed in. But Jeff Bezos was one of them. There were probably one or two others who went onto some degree of enviable success, and some who were just serial Internet entrepreneurs in the Sean Parker (though not as good at it) mold.
     
    Dick Whitman, Aug 6, 2013
    #36
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