Jeff Bezos lost $6 billion in one day, a figure that is more than what most people could make in 100 lifetimes. News that Amazon’s CEO and founder suffered such a great loss came as a surprise to investors on Wall Street and it also brought disappointment. E-commerce giant Amazon missed both its estimated earnings per share and revenue benchmarks, which caused its stock to take a serious nosedive and it fell from just over $631 a share to under $578 in the past 24 hours, Business Insider reports.
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Regarding Bezos’ $6 billion loss, technology expert and senior managing editor at CNET, Kent German, gave the following statement.
“Despite Amazon reporting its third straight quarter of profits and record sales, the company missed analyst expectations by a wide mark,” German explained. “It continues to expand in new areas like cloud services, streaming entertainment and hardware, but the growing number of Amazon Prime users are presenting the company with a fulfillment problem. It hasn’t been able to recover the shipping costs it’s incurring to meet its promise of free delivery to Prime customers.” He added that “the challenge over the next year will be to cut shipping costs without prohibitively raising the cost of Prime membership.”
Jeff Bezos, who owns nearly 84 million shares of Amazon Stock, saw his net worth plummet in a very short period of time, and, in just 30 minutes, he lost $800 million on Thursday. According to Forbes magazine, he also lost his ranking as the fourth richest person in the world to Carlos Slim Helu, a Mexican business magnate, investor and philanthropist.
Bezos’ $6 billion loss is due to the fact that although Amazon reported a profit of $1 per share, analysts expected an average profit of $1.56. Upon hearing this, the company’s stock quickly dropped and it fell to a low of $545.97 after hours from its closing share price of $635.55 per share. As of 5 p.m. ET Thursday, Amazon was trading at only $562.80. Amazon’s stock also dropped because the holiday quarter didn’t go as planned and expenses exceeded the company’s expectations.
Amazon shares ended the session on Wall Street with a rise of 8.91 percent to $635.35 per share. However, they fell sharply in the prolonged closure of the stock market, just after the results were known.
In 2013, Amazon’s U.S. sales came to $44 billion, which placed it in the top 10 U.S. retailers. According to a report from The Associated Press, last year Amazon surpassed the world’s largest retailer, Wal-Mart Stores Inc., in market value. However, since early 2016, its shares have fallen 6 percent due to uncertainties on international growth.
While Jeff Bezos may have experienced a $6 billion loss in just one day, there is good news because his company experienced success in other areas – such as its own-brand hardware and Amazon Prime membership plan. Amazon reported substantial gains it Fire TV streaming devices and it remains the best-selling in the country. Prime membership – which includes access to the Fire TV streaming service of films and television, as well as a music service and quicker delivery from Amazon Store – rose by 51 percent globally.
Meanwhile, Facebook co-founder and CEO Mark Zuckerberg recently saw a $6 billion gain in his net worth, which means he has now surpassed oil magnates Charles and David Koch to become the sixth richest person in the world. The company’s stock rose 13 percent and the social networking company reported a 52 percent rise in fourth-quarter sales and its net income saw a twofold increase to $1.56 billion. These earnings beat street estimates, resulting in the rise in shares, Times of India wrote in a report.
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Facebook’s stock price continues to increase and the recent spike made it’s 31-year old founder $6 billion richer in one day and his net worth soared to $47.5 billion. An estimated 1.59 billion Facebook users log on to the social networking site each month.
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