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History and business model of Amazon
Amazon was founded in 1994, spurred by what Bezos refers to as his regret minimization framework, his effort to fend off late in life regret for not staking a claim in the Internet gold rush.1 It is common lore that Bezos wrote its business plan while he and his wife drove a 1988 Chevrolet Blazer from Fort Worth, Texas to Bellevue, Washington,although this story is largely apocryphal according to early employees of the company.original research?
The company began operating as an online bookstore under the name Cadabra.com (as in abracadabra), a name that Bezos quickly abandoned due to its sounding like "cadaver". While the largest brick-and-mortar bookstores and mail-order catalogs for books might offer 200,000 titles, an online bookstore could offer many times more. Bezos renamed his company "Amazon" after the world's most voluminous river.
The company was incorporated in 1994, in the state of Washington, began service in July 1995, and was reincorporated in 1996 in Delaware. The first book ever sold by Amazon.com was Douglas Hofstadter's Fluid Concepts & Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought.Amazon.com had its initial public offering on May 15, 1997, trading on the NASDAQ stock exchange under the symbol amazon at an IPO price of US$18.00 per share (equivalent to US$1.50 after three stock splits during the late 1990s).
Amazon's initial business plan was unusual: the company did not expect to turn a profit for four to five years. In retrospect, the strategy was effective. Amazon grew at a steady pace in the late 1990s while many other Internet companies grew at a blindingly fast pace.
Amazon's "slow" growth caused a number of its stockholders to complain, saying that the company was not reaching profitability fast enough. When the Dot-com bubble burst and many e-companies went out of business, Amazon persevered and finally turned its first profit in the fourth quarter of 2002: a meager US$5 million, just 1¢ per share, on revenues of over US$1 billion, but it was important symbolically.
The firm has since remained profitable: net income was US$35.3 million in 2003, US$588.5 million in 2004, US$359 million in 2005, and US$190 million in 2006 (including a US$662 million charge on R&D in 2006). Nevertheless, the firm's cumulative profits remain negative. As of September 2007, the accumulated deficit stood at US$1.58 billion.
Revenue continued to grow thanks to product diversification and international presence: US$3.9 billion in 2002, US$5.3 billion in 2003, US$6.9 billion in 2004, US$8.5 billion in 2005, and US$10.7 billion in 2006. On November 21, 2005, Amazon entered the S&P 500 index, replacing AT&T after it merged with SBC Communications.
Time Magazine named Bezos its 1999 Person of the Year in recognition of the company's success in popularizing online shopping
Save on Outdoor and Hiking Shoes at Amazon! Get extra 20% OFF hiking boots, water sandals, and more! Select items only! Ends March 23. 2015! Redeem this Amazon Promo Codes 20% OFF now!
History and business model of Amazon
Amazon was founded in 1994, spurred by what Bezos refers to as his regret minimization framework, his effort to fend off late in life regret for not staking a claim in the Internet gold rush.1 It is common lore that Bezos wrote its business plan while he and his wife drove a 1988 Chevrolet Blazer from Fort Worth, Texas to Bellevue, Washington,although this story is largely apocryphal according to early employees of the company.original research?
The company began operating as an online bookstore under the name Cadabra.com (as in abracadabra), a name that Bezos quickly abandoned due to its sounding like "cadaver". While the largest brick-and-mortar bookstores and mail-order catalogs for books might offer 200,000 titles, an online bookstore could offer many times more. Bezos renamed his company "Amazon" after the world's most voluminous river.
The company was incorporated in 1994, in the state of Washington, began service in July 1995, and was reincorporated in 1996 in Delaware. The first book ever sold by Amazon.com was Douglas Hofstadter's Fluid Concepts & Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought.Amazon.com had its initial public offering on May 15, 1997, trading on the NASDAQ stock exchange under the symbol amazon at an IPO price of US$18.00 per share (equivalent to US$1.50 after three stock splits during the late 1990s).
Amazon's initial business plan was unusual: the company did not expect to turn a profit for four to five years. In retrospect, the strategy was effective. Amazon grew at a steady pace in the late 1990s while many other Internet companies grew at a blindingly fast pace.
Amazon's "slow" growth caused a number of its stockholders to complain, saying that the company was not reaching profitability fast enough. When the Dot-com bubble burst and many e-companies went out of business, Amazon persevered and finally turned its first profit in the fourth quarter of 2002: a meager US$5 million, just 1¢ per share, on revenues of over US$1 billion, but it was important symbolically.
The firm has since remained profitable: net income was US$35.3 million in 2003, US$588.5 million in 2004, US$359 million in 2005, and US$190 million in 2006 (including a US$662 million charge on R&D in 2006). Nevertheless, the firm's cumulative profits remain negative. As of September 2007, the accumulated deficit stood at US$1.58 billion.
Revenue continued to grow thanks to product diversification and international presence: US$3.9 billion in 2002, US$5.3 billion in 2003, US$6.9 billion in 2004, US$8.5 billion in 2005, and US$10.7 billion in 2006. On November 21, 2005, Amazon entered the S&P 500 index, replacing AT&T after it merged with SBC Communications.
Time Magazine named Bezos its 1999 Person of the Year in recognition of the company's success in popularizing online shopping
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