This is a partial transcript from Your World with Neil Cavuto, December 18, 2001.
NEIL CAVUTO, HOST: Are those sales working enough and are they strong enough and convincing enough to make Jeff Bezos' most startling promise ever come true: a profitable quarter? He has never had one, maybe, maybe, until now.
Jeff Bezos, the big cheese at Amazon.com joins me right now. Jeff, is this your magic moment?
JEFF BEZOS, CEO, AMAZON.COM: Hi, Neil.
Well, you know, on October 23 — we don't give any mid-quarter guidance — but on October 23, we reconfirmed that it is our goal this quarter to have a pro forma operating profit. So that's a goal we set a year ago. Actually, internally, we set it 18 months ago.
CAVUTO: All right. Well, I know it's a goal, but I can set a goal to lose weight and I can tell you it doesn't always work.
So, are you in fact going to be profitable this quarter? Can you make that prediction now?
BEZOS: You'll have to wait until our results in January to find out the answer to that question.
CAVUTO: It sounds like one of my diets.
So, in other words, you don't know. How is it looking? I mean, if you had to weigh the odds, how is it looking?
BEZOS: Well, with respect to the holiday season in general, it's so far, so good. We like what we see in terms of unit sales. What we have seen is people are very, very busy buying online. What they are doing is they are buying less expensive items than they did last year. So in our electronics store, for example, it is the sub-$100 DVD players that are flying off the shelves. That has done very, very well.
It's not too late by the way, Neil, I want all of your viewers to know, get your Christmas shopping done at Amazon.com for delivery on Christmas Eve. They can do that right up until noon on Saturday.
CAVUTO: OK. And I should disclose I am a busy Amazon.com shopper myself, so let's put that out there.
BEZOS: Thank you, Neil.
CAVUTO: But let me ask you this...
BEZOS: We love your business.
CAVUTO: I bet you do.
But let me ask you about just where people are putting their money. I mean, you really need them going to the high-margin stuff more than just the stuff where there's little overhead, right?
BEZOS: Well, for us, one of the things that's very important is our business model works better on products that are — you know, that tend to be a little bit more expensive. If you get down into the...
CAVUTO: Like what? What do you mean, a little more expensive?
BEZOS: Well, what I mean by not expensive is a $7 or $8 item. Those items tend to be very difficult because we still have to pick those items. And the costs that we incur on handling a $7 item are the same as the costs that we would incur on a $20 item.
CAVUTO: But you have the whole Vincent Price collection. So that alone, even though it's a cheap DVD, I mean, it's worth it there. But you need people to buy more than, oh, Vincent Price collection DVDs, right?
BEZOS: Well, there are many things that we like when people buy. The electronics business is a great one for us and that's certainly — the tools business, the kitchen business, those are all doing very well. We are very pleased with what we see there.
CAVUTO: The best item you like people buying is what? Where you get the thickest profit?
BEZOS: Well, one of the things that I think surprises people is how well some of our newer categories like magazine subscriptions are doing. And, in fact, magazine subscriptions — we have a very nice contribution profit when we sell magazine subscription, even though we have the guaranteed lowest prices online. And it is — basically any magazine you want to buy. And those make great gift items. And, of course, you can get those right up through December 24.
CAVUTO: All right. Well, Jeff, I wish you better luck with your quarter and certainly my diet, but...
CAVUTO: Always good having you on.
BEZOS: Thank you, Neil. You look very nice.
CAVUTO: Thank you, sir.
All right, Jeff Bezos, the man who runs Amazon.com. Who knows, this could be the first profitable quarter in the company's history.
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