A shop sells €100 this year and €140 four years later. Its costs go from €90 to €146. It sells 40% more and now loses €6.
← The MachineWhat it is Why it happens The numbers The trap Where you see it In one lineNextProfit on paper. No cash in the bank
Growth costs money: more staff, more space, more ads, lower prices to attract customers. When costs grow faster than sales, each new sale can make the hole deeper.
In 2022 Amazon sold $514 billion, up 9% on the year before. Its operating profit fell by half, from $25 billion to $12 billion.
Headlines love record sales. But big is not the same as profitable. In 2023 Amazon’s shops outside North America sold $131 billion and lost $2.7 billion.
Every annual report starts with sales, then takes away the costs. Put two years side by side: did profit grow as fast as sales?
Sales are only the top line. Check that profit grew too, not just revenue.
Do it today
Find one company’s revenue and profit.
Episode done · saved to your path