Amazon's founder and CEO Jeff Bezos Loses $2.8 Billion In A Day

Amazon.com was chipper late Thursday
about its first-quarter earnings report.
On Friday, Wall Street offered its view
about the results and the outlook. It wasn’t
pretty. Especially for founder and CEO Jeff
Bezos.


The shares fell 9.9% to $303.83, their lowest
close since Oct. 9, when they finished at
$298.23. The percentage loss was its largest
since Jan. 31, when the shares fell 11% after
revenue and profits missed forecasts.
The plunge cut the value of Bezos’ stake in
the company by nearly $2.8 billion in just
one day.


Amazon shares are now down 25.5% since
hitting $408.06 on an intraday basis on Jan.
22. They’re off 25.4% since its closing high
of $407.05 on Jan. 21.


So, what was the problem? Guidance.
Amazon said it could post an operating loss
of $455 million in the second quarter — or
a profit of $55 million. That more than
offset its expectation that revenue could
grow 15% to 26% from last year’s second
quarter, to $18.1 billion to $$19.8 billion.


Friday’s plunge means the market
capitalization of Amazon has fallen from
nearly $194 billion to $144.6 billion, based
on 476 million outstanding shares. Bezos,
who said the year had gotten off to a
“kinetic start,” has seen the value of his
stake in Amazon fall from $34.1 billion to
$25.4 billion. Bezos owns nearly 84 million
Amazon.com shares, 18% of the shares
outstanding.


Amazon was the worst performer among
stocks in the Standard & Poor’s 500 Index
and the Nasdaq-100 Index. Stocks had a
rotten day overall, in part because of
worries about Russia and Ukraine tensions.


It may be unfair to concentrate on Amazon
because of a number of momentum stocks
have battered since peaking earlier this
year. Tesla Motors shares are down 23%
from their March 4 peal. So, CEO Elon
Musk’s 35 million shares have fallen about
$1.9 billion. Google’s class A shares are
down 14.3% since Feb. 25. So, theoretically
co-founder Larry Page’s net worth has been
trimmed from $28.6 billion in February to
only $24.6 billion.