Understanding 1) how unit economics and cash flow impact value; and 2) doing a competitive analysis of the businesses, would require work so they instead write about profit as a shortcut. The shortcut only makes sense if profit predicts long term cash flow.wsj.com/articles/a-dec…
Anyone can look up reported profits of public businesses on one of many web sites. Those numbers supply zero informational or analytical edge. The value of a business is equal to the sum of the lifetime value of existing and future customers. That's a source of investing edge.
An income statement alone is not enough to determine whether a business is creating value. You must also understand the unit economics of the business and do a competitive analysis. When someone says a business is “making money” or “losing money” often they're avoiding work.
