This is a partial transcript from Your World with Neil Cavuto, April 24, 2002. Click here for complete access to all of Neil Cavuto's CEO interviews.
BRENDA BUTTNER, GUEST HOST: It looks like the force was with Amazon.com (AMZN) last quarter. The online retailer announcing its first-quarter results just moments ago. Amazon beat Street estimates coming in with a loss of just six cents a share. The company also raised its guidance going forward.
CEO Jeff Bezos joins us now from Seattle to sort it all out. Hey, Jeff.
JEFF BEZOS, CEO, AMAZON.COM: Hey, Brenda.
BUTTNER: Well, I was expecting you to have a Yoda costume on now. Aren't you going to get into the spirit here?
BEZOS: Well, I'll tell you, I am not wearing the Yoda costume, but your viewers can certainly find those toys at Amazon.com. So, come on in.
BUTTNER: Oh, I'm sure that is true. Well, congratulations on your report. You did beat the Street. However, you are still not making money. You did last quarter, but not this one.
BEZOS: Well, last quarter is our heavy seasonal quarter with the Christmas selling period. We are very happy with these results. We exceeded our own expectations as well as the expectations of the Street.
The big news today is that based on the performance and how much cost savings we have been able to drive in our business and so on, we are able to once again, lower price. This is the third price cut for customers in just nine months. A lot of the results this quarter were driven by the super-saver shipping, free shipping on orders over $99 that we put in place as a year-round, 365-day a year thing last quarter. We are doing it again now. Books over $15 are now 30 percent off. That is a significant price cut, something that's very important to the future of our business.
BUTTNER: And one that cuts right into your margins. When are you expected to be profitable again? Are you expecting it...
BEZOS: Well, the thing we are really focused on is driving free cash flow this year. And we expect to have pro forma operating profits this year of $100 million or more. That is the guidance that we are giving.
BUTTNER: That means when you take out all the expenses and all that other stuff?
BEZOS: When you take out certain items, that's right.
BUTTNER: But what about general gap, the good old profit means profit?
BEZOS: Well, free cash flow is a gap number, we do not and actually cannot forecast gap earnings because of variable accounting charges with the respect an option exchange program that we did. So, that is not something that we do.
BUTTNER: Toys "R" Us, you mentioned it, that that's where we could get a lot of these great Star Wars games and all the rest. Are you having some problems with some of your relationships with your partners? There was some rumor a while back that Toys "R" Us actually wanted to renegotiate its partnership.
BEZOS: We love our relationship with Toys "R" Us. And, by the way, they are very happy with their relationship with us. So, we do not respond to those kind of rumors. But that's a great partnership. It's been working very well.
The toy business at Amazon.com, which is the Toys "R" Us business, we operate that Web site for them on Amazon.com, that business on a stand alone basis is probably the -- I may have this slightly wrong -- but I'm going to say the fifth largest e-commerce business anywhere in the world. So that business is going extremely well.
BUTTNER: Your stock is up about 30 percent so far this year. A lot of people say it is time to get out. Are you selling?
BEZOS: Well, we never comment on the value of the stock. I think we have a hard job here as the management team of Amazon.com, which is to build a lasting company, to work hard on creating shareholder value over the long-term.
What the right stock price is at any given point and time is an equally hard thing to determine, and we leave that to analysts and investors. We are certainly not going to comment on it.
BUTTNER: All right. Jeff Bezos, congratulations. With or without your Yoda costume, we welcome you.
BEZOS: Thank you.
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