From a financial analysis perspective, there is of course, a serious difference between Amazon and Amtrak that blinds many to the similarities between the country's largest online retailer and its largest overland passenger railroad: size. Last year e-tail giant Amazon reported $61 billion in revenues, up an impressive 25% or so from the $48 billion it made in 2011. Amtrak, whose official name is the National Railroad Passenger Corp., reported just $2.9 billion in total revenues -- up about 6% from $2.7 billion in 2011. But once past this contrast of scale, the posture, profits and troubling issues each face are eerily similar. For starters, both companies have a freakishly similar, blithe approach to profits. There is Mr. Bezos' zillion-times-quoted line from a Harvard Business Review interview this year about how "Percentage margins are not one of the things we are seeking to optimize." The two execs who run Amtrak, President and CEO Joseph H. Boardman and Chairman of the Board Thomas Carper, speak with a similarly blurry vision of making money in their annual letter to investors. "We generated enough revenue to cover 88% of our cash operating costs," they wrote.
The investor boogie man looming here in the dark, of course, is that as much as these CEOs and the Wall Street sell-side analysts who back them like to pretend otherwise, these kinds of free-cash-flow analyses simply do not jibe with Generally Accepted Accounting Principles. "'Free cash flow' does not have a uniform definition, and its title does not describe how it is calculated," read a Securities and Exchange Commission guidance release titled, not surprisingly, Frequently Asked Questions Regarding the Use of Non-GAAP Financial Measures.
Finally, we pull into the ultimate final investor diss: the taxpayer subsidiaries. Amtrak, at least, levels with the world and admits on Page 84 of its annual statements that, as of 2012, it got a direct cash infusion of $1.4 billion from Uncle Sam. No such tax mea culpa is anywhere near Amazon's financial statements, as far as I could find. But the damage done to all our pockets is easy enough to total up. Assuming a national average sales tax rate of 6% on the $61 billion of last year's total sales, that's an implied combined state tax subsidy of about $3.6 billion. Or about the deficits of states such as Ohio, Florida and Connecticut. That all mean, friends, for all the flash and dash of The Washington Post deal, the Internet has pulled into this exact dank, sad terminal station: Nothing can change the fact that Amazon and Amtrak have much more in common than the first two letters of their company names.