this post was submitted on 10 Jan 2024
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Technology
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50? Idk the biggest techbro firms NEVER made any money ever. Fucking Spotify is yet to be profitable. Who exactly are they planning to sell more service to?
50 is generous.
You operate on the assumption that just because a company isn't claiming profits it's not growing in value, that is just not how the game is played anymore.
Now, sure, the game they're playing, "Go into debt to buy everything in sight and claim you're operating at a loss despite increasing the value of your holdings exponentially" was literally outlawed for being a major factor in the collapse that lead to the Great Depression, but they've surely learned from that, right?
If a company makes a profit and they don't spend it, they're liable for corporation tax on it. It's in their best interest to spend it on growing.
It's just the more you spend, the more likely you are to hit diminishing returns. If you have shops in two towns, you can build another in a third town and make more money. Easy. If you already have enough shops to serve all the towns, building another might just take sales from your existing shops.
The corporations don't like this so now it's time to fire everybody and run a shit service with a skeleton crew instead, while jacking up the prices and hope your customers don't notice they're paying more for less.
That only became a thing recently with the ability to buyback stock preventing stock dilution, the low cost of buying and selling stock, and a shit bond market.
And if there isn't a competitor on the horizon, why invest in R&D?