NEW YORK--A recent analyst's report that sent Amazon.com's
stock tumbling to a 52-week low was "incorrect," chief executive Jeff Bezos
"We have about $1 billion in cash reserves and expect to generate cash flow
from operations" in the near future, he said in his keynote address at PC
Last week, a report by a Lehman
Brothers analyst expressed concern about Amazon's cash reserves, sending
the stock down 19 percent to a new 52-week low of $33.78.
Amazon shares rallied earlier this week after several other analysts
rushed to counter last week's negative outlook by Lehman. Still, the stock
is down more than 33 percent for the month.
Bezos declined to say when the entire company would be profitable.
Only the books unit posted a profit in the fourth quarter of last
year and in the first quarter this year.
Still, Bezos took the "Amazon bashing" in good spirit, joking that some have
suggested renaming the company "Amazon.org" because it is clearly "a not-for-profit company." Others suggested "Amazon.con" and "Amazon.toast," he said.
Bezos' appearance at PC Expo once again underscored how the show, and the PC
industry in general, is no longer obsessed with the feeds and speeds of the
desktop box, but instead with the entire computing experience. PC makers are converting themselves into Internet service providers and consulting and services firms that also sell hardware, while companies like Amazon are becoming trusted partners in product development.
Two years ago, then-Compaq chief executive Eckhard Pfeiffer and Novell chief executive Eric Schmidt were featured speakers. This year, Bezos and
Handspring founder Jeff Hawkins spoke.
The spotlight on Amazon at PC Expo comes at a time when the entire e-tailing
sector, once a Wall Street darling, has been rocked in recent months as
analysts and investors have suddenly pegged the e-commerce players as "retailers"
rather than technology plays. Successful e-tailers, they argued, have the
same business issues as brick-and-mortar stores, including inventory
management, distribution and customer relations, and should therefore be
valued as retailers.
The list of casualties includes layoffs at Furniture.com, Living.com,
EMusic and PlanetRx. The carnage also includes the outright shuttering of
stores; Oxygen Media closed two of its shopping-related
Web sites for women, and toy retailers Toysmart and RedRocket recently met their demise.
While many analysts consider Amazon immune to some of the sector's
turbulence, the Seattle-based e-tailer has had its share of trouble. In
January, Amazon announced its first major layoffs.
Personalization, or the tailoring of people's online shopping experience based on previous purchases, could invigorate Internet shopping and build consumer loyalty, Bezos said today. He demonstrated Amazon's "Trusted Friends" technology using
his own personalized Amazon page.
Amazon, one of the few e-tailers offering personalization
services, is hoping that personalization will encourage shoppers to return
to its site more often and to make more frequent purchases. So far, however,
most e-tailers that offer personalization have been plagued by technology
issues and privacy concerns.
Bezos defended the systematic collection of shoppers' buying histories,
although he admitted there is no way an e-tailer can reasonably
guarantee 100 percent safety of data. He said Amazon will hold on
to information "forever," insisting that the more data it has, the
better shopping experience the company can offer to an individual. He also
downplayed how critical the collected information would be to most others.
"We're not talking about medical records or financial records; we're talking
about consumer purchases," he said.
The company is already embroiled in some privacy battles with its Alexa
Internet unit, the subject of both an inquiry by the Federal Trade
Commission and two lawsuits over alleged privacy violations.