Comment Re:Drastically reduced profits? (Score 1) 438
Yes, the percentage that fell is specifically their profit margin. And while 43.7% to 42.2% is only a 1.5% difference, that is a 1.5% difference in millions of dollars. Since their business practices are centered around huge profit margins, this decrease is pretty significant for them. Please don't think of me being sympathetic towards them, I am not. I could care less if they only made $250 million dollars last year rather than $260 million (these numbers are not based in fact, just using it as an example).
However, when their business model is dependent on them making $260 million, they either have to scale back some where or raise service rates in order to compensate for the $10 million that they were expecting to be there but isn't. Where it gets ridiculous, is that for tax purposes, they are actually able to write off this $10 million as a "loss". Even though in reality they didn't lose anything instead they just made less than what they were expecting.