It’s not a small feat, but they also 4x’d their expenses, which made them lose significantly more. Long term as you mentioned, if they could entirely drop their R&D, which they’ll never get to $0, but if they did, they’d still be almost -$2 billion in profit. Business modes can change to help accommodate that at that point theoretically though.
I just don’t see them ever getting there. How many years can you lose $20 billion and stay solvent? They’ll raise prices like everyone, but they may lose customers offsetting the gains made, or even if they get more, operating costs will go up too. With all of the DCs being built, I also don’t see R&D going down anytime soon either.
How many years can you lose $20 billion and stay solvent?
As long as investors keep pumping money into it. Uber lost billions a year until relatively recently, and they didn’t have nearly the same queue of investors ready to pour money into them at an insane markup. You underestimate the tolerance for silicon valley vcs to take in years of loss as long as the companies growing.
With all of the DCs being built, I also don’t see R&D going down anytime soon either.
Wouldn’t more data centers reduce there cost? More data centers means more capacity and more competition pushing the price down.
It’s not a small feat, but they also 4x’d their expenses, which made them lose significantly more. Long term as you mentioned, if they could entirely drop their R&D, which they’ll never get to $0, but if they did, they’d still be almost -$2 billion in profit. Business modes can change to help accommodate that at that point theoretically though.
I just don’t see them ever getting there. How many years can you lose $20 billion and stay solvent? They’ll raise prices like everyone, but they may lose customers offsetting the gains made, or even if they get more, operating costs will go up too. With all of the DCs being built, I also don’t see R&D going down anytime soon either.
As long as investors keep pumping money into it. Uber lost billions a year until relatively recently, and they didn’t have nearly the same queue of investors ready to pour money into them at an insane markup. You underestimate the tolerance for silicon valley vcs to take in years of loss as long as the companies growing.
Wouldn’t more data centers reduce there cost? More data centers means more capacity and more competition pushing the price down.