- Stamps.com shares crashed more than 50% Friday after the company reported its quarterly earnings the prior evening.
- The California-based online mailing and shipping services company said it was ending its partnership with the US Postal Service.
- The company’s partnership with Amazon was a frequently discussed topic on the call.
- Watch Stamps.com trade live.
Stamps.com crashed more than 50% Friday after the company said it would end its partnership with the US Postal Service.
The California-based online mailing and shipping services company told investors during its quarterly earnings call that it no longer sees an exclusive partnership with the postal service “as the right strategy for Stamps.com.”
“We have to align our organisation to be well-positioned as the significant changes in the shipping business a core over the next five years,” said Kenneth McBride, the company’s chairman and CEO.
Stamps.com’s relationship with Amazon was discussed at length on the call.
“You have previously served them as a vendor. You’ve been a partner of theirs. They have been a competitor at times. Where is your potential relationship or current relationship with Amazon?” Greg Frederick Sutton, a senior research analyst at Craig-Hallum Capital, asked McBride on the call.
“I mean I think you heard us say it like Amazon is the powerhouse, the gorilla in e-commerce, and so we need to work with Amazon and really everybody needs to work with Amazon,” McBride responded, adding that Amazon is a “key strategic partnership for us to court and have in our multi-carrier solutions.”
McBride also said the threat from Amazon “should be taken very seriously by every player in the shipping industry,” and that Stamps.com was setting up its corporate strategy while taking that into consideration.
As for its quarterly results, Stamps.com reported adjustedearnings of $US3.73 per share on revenue of $US170 million, topping the $US2.90 and $US160 million that analysts surveyed by Bloomberg were expecting.
Stamps.com shares have been on a wild ride since their public debut in 1999. They soared nearly 620% during the dot-com era before crashing 97% between its 1999 peak and the end of 2000. After going nowhere for the next decade, shares experienced a renaissance of sorts in 2002, soaring 1,000% to a record high of $US285.75 last June.
They were trading at $US85.53 per share after Friday’s crash.
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