Amazon's Jeff Bezos Is Still The World's Best CEO By One Measure

Jeff Bezos had a bad week.

Calls to rein in the ambitious Amazon chief executive grew loud on Thursday after the e-commerce giant reported its biggest quarterly loss in 14 years, driven by the anemic sales of its Fire Phone, the company’s first smartphone. The losses were seen as proof of Bezos’ reckless obsession with prioritizing growth over profitability. The 50-year-old tech mogul was lambasted as a megalomaniacal “Grinch” who stole Christmas from a company so bad at making money that it’s “not a real business.”

Yet, according to the November issue of the Harvard Business Review, Bezos is the best-performing CEO in the world. Despite the latest bad news, the venerable magazine stands by that assessment.

“People have bet against him over the years, and historically they’ve been wrong,” Daniel McGinn, the senior editor who profiled Bezos, told The Huffington Post on Saturday. “He definitely has a set of shareholders who have faith in him because of his ability to deliver despite a lot of doubt over the last 20 years.”

The Harvard Business Review compiled its list of top CEOs by comparing shareholder returns for S&P Global 1200 companies from each executive’s first day in office until April 30 of this year. Bezos won by a wide margin. Even if Amazon’s stock price -- which plummeted nearly 9 percent to $287.06 on Friday -- fell to $250, he still would have beaten runner-up John Martin, the CEO of biotech giant Gilead Sciences.

“He had quite a bit of leeway,” McGinn said. “He had such a big lead over everyone else.”

Amazon's stock tumbled after a disappointing earnings report on Thursday.

Profitable quarters are rare for Amazon, but the company generates strong revenues. Bezos’ strategy, which both befuddles and inspires investors, is to reinvest money to continually grow Amazon. A small online bookseller thereby became a video streaming service, a cloud-computing behemoth, a grocer and, most recently, a smartphone maker.

But the Fire Phone, unveiled in June, has flopped. A study published in August by the ad network Chitika, which measured web traffic from Fire Phones, found a paltry number of the devices were in use. In a conference call with analysts on Thursday, Amazon’s chief financial officer, Thomas Szkutak, admitted that the dearth of people buying the phone had cost the company $170 million in losses “primarily related to the Fire Phone inventory evaluation and supply commitment costs.”

“It’s not unusual for them to lose more money,” McGinn said. “It is unusual for them to miss a growth target.”

That doesn’t seem to worry Bezos, however.

“Even though we have significant revenues, we invest in so many new initiatives that in some ways we’re still a startup,” he told McGinn sometime before last week’s earnings report. “Volatility is part of being a startup.”

Bezos may be alone in thinking of the company as a nascent venture. Since going public in 1997, Amazon has grown so large and powerful that some have called it a monopoly ripe for a regulatory crackdown.

Still, even as Amazon stock takes a hit, the company is a lucrative investment by the Harvard Business Review’s methodology.

“If you could go in a time machine and go back to 1997 and you had the chance to buy stock on that day, would you do it?” McGinn asked rhetorically. “In financial terms, you’d still be many thousand percentage points ahead today.”

Amazon did not return a call requesting comment.

Brace Yourself: Ugg Season May Be Even Bigger Than Usual This Year

Each year as the temperature dips, women across the country turn to their closets and dig their Ugg boots out of hibernation. Others head to stores to score a pair of the squat sheepskin booties in preparation for a chilly winter.

This year the Ugg frenzy may be even bigger than usual. Sales at the Ugg brand rose nearly 24 percent last quarter to $417 million, compared to $337 million for the same period the year prior, parent company Deckers reported Thursday. The spike was due to higher wholesale sales, online sales and new retail store openings worldwide.

And now, Ugg is about to enter its prime season.

"With temperatures turning cold in recent weeks, sell-through of weather boots and classics have gained pace across the majority of our markets," Deckers chief executive Angel Martinez said on a conference call with analysts on Thursday.

Ugg's upcoming product lines are "as compelling as we have ever seen for the company," Sam Poser, an analyst at Sterne Agee, wrote in a note to clients on Friday. He added that Ugg's reaping the benefits of favorable fashion trends, as shoppers search the aisles for comfy clothes like stretchy leggings and oversized sweaters.

However Ugg's holidays turn out, "Ugg Season" will remain. The annual donning of the Uggs has even made its way into memes, like "Girls be like."

Meanwhile, Ugg's plan to diversify its offerings seems to be working. Ugg is now selling more items that aren't dependent on cold weather. It launched a home goods line in October, offering an assortment of sheepskin area rugs, knit pillows and floor poufs. There's also Ugg's loungewear line, a casual clothing label. On the call, Martinez said that Ugg's home and loungewear businesses are still "small but burgeoning" and early results have been "very strong." Ugg will be pushing both lines hard through the holidays.

In an attempt to tell customers Ugg sells more than just shearling boots, the brand launched an advertising campaign in August with the tagline "THIS IS UGG," featuring sketch artist Langley Fox Hemingway and New England Patriots quarterback Tom Brady.

But until those lines get bigger, Ugg remains a slave to the elements. According to a report from Nomura Securities, Deckers is the best example of a company that's exposed to weather risk, something it could never hope to control. So far, the climate has treated Deckers, which also owns footwear brands Teva and Sanuk, quite well this year.

"Despite the mild weather conditions over the last two winters, this year was more seasonably cool and snowy in many parts of the U.S., which had a substantially large impact on companies with a great deal of cold weather product including Deckers," Nomura analyst Bob Drbul wrote in the report.

Amazon Stock Tanks On Massive Loss, Disappointing Forecast

SAN FRANCISCO (Reuters) - Amazon.com Inc's sales projections for the crucial holiday quarter disappointed, and third-quarter results missed Wall Street's targets, sending the online retailer's shares 9 percent lower.

Some analysts fear that the U.S. holiday shopping season, the biggest quarter for most retailers, might turn out weaker than anticipated. The company projected on Thursday net sales of between $27.3 billion and $30.3 billion for the holiday quarter, lagging the $30.89 billion analysts had expected on average.

After an unusually busy first half of the year that saw the online retailer spend on developing everything from mobile phones and Hollywood-style production to grocery deliveries, investors were ready to see it curtail its ambitions somewhat and start delivering sustainable profits.

Instead, its third-quarter net loss widened to $437 million or 95 cents per share in the third quarter, from $41 million a 9 cents a year ago. That came in larger than forecasts for a loss of 74 cents a share.

Revenue also fell short of expectations, from a company known for consistently chalking up robust top-line growth. Net sales rose to $20.58 billion, but that lagged forecasts for $20.84 billion, according to Thomson Reuters I/B/E/S.

Shares in the company slid more than 9 percent to $284 in extended trade.

(Reporting by Deepa Seetharaman; Editing by Dave Gregorio and Cynthia Osterman)

McDonald's Profits Plunge 30 Percent

Oct 21 (Reuters) - McDonald's Corp reported a 30 percent fall in quarterly profit due to a food scandal in China and tough competition in the United States, and the world's largest restaurant chain said these factors were expected to hurt current-quarter results.

The company's shares fell 2 percent in premarket trading after it also said it expected a fall in same-restaurant sales for October.

McDonald's U.S. and global comparable sales fell by a steeper-than-expected 3.3 percent in the third quarter.

The company has been struggling in the U.S. market, where the fast food it helped pioneer is falling out of favor, with customers choosing healthier options available at chains such as Chipotle Mexican Grill.

McDonald's business in Europe, its biggest market, was hurt by issues in Russia and Germany. Sales in China, its fastest-growing market, plunged due to a supplier scandal.

"McDonald's third-quarter results reflect a significant decline versus a year ago ... by all measures, our performance fell short of our expectations," Chief Executive Don Thompson said in a statement.

Same-restaurant sales at McDonald's Asia-Pacific, Middle East and Africa (APMEA) business tumbled 9.9 percent, while those in Europe fell 1.4 percent.

Analysts on average had expected same-restaurant sales to fall 3 percent globally, 2.9 percent in the United States, 10.6 percent in APMEA and 0.3 percent in Europe, according to research firm Consensus Metrix.

McDonald's net income fell to $1.07 billion, or $1.09 per share, in the quarter ended Sept. 30 from $1.52 billion, or $1.52 per share, a year earlier.

Total revenue fell 4.6 percent to $6.99 billion.

McDonald's shares closed at $91.59 on the New York Stock Exchange on Monday. Up to Monday's close, the stock had fallen 5.6 percent this year. (Reporting by Siddharth Cavale in Bangalore and Lisa Baertlein in Los Angeles; Editing by Kirti Pandey)

Correction: A headline on an earlier version of this story incorrectly said that McDonald's sales plunged 30 percent.

Chipotle Founder Calls Competition From Fast Food 'A Joke'

Chipotle isn't concerned about competition from the fast-food industry.

The burrito chain's soaring stock price has rivals like Yum Brands, which owns Taco Bell, KFC and Pizza Hut, scrambling to cook up concepts that, like Chipotle, use high-quality, fresh ingredients.

But Chipotle founder Steve Ells doesn't see them as a threat.

"It's a joke," Ells, who serves as co-CEO, said in an interview published this week by Fast Company. "You know those guys, right?"

Chipotle's stock price (blue) has grown at a much faster rate than those of traditional fast-food rivals McDonald's (red), Yum Brands (yellow), Burger King (green) and Wendy's (indigo).

Plagued by a reputation for mystery-meat concoctions and food so chemically altered that it won't decay, behemoths like McDonald's and Taco Bell have kicked off campaigns to debunk negative perceptions of their menu items. Despite their attempts to introduce more healthful fare, Ells said, the companies are still too stuck in their ways.

"They can't change," he said. "The culture is too ingrained. Which bodes well for Chipotle."

But they can try. Earlier this year, Yum launched Banh Shop, a Vietnamese street food chain, in Dallas. In a more direct challenge to Chipotle, the company also opened U.S. Taco Co., an upscale taqueria, in Huntington Beach, California. Both restaurants use fresh ingredients, which command higher prices than typical fast food.

These 5 Scary Obamacare Predictions Were Dead Wrong

Predicting the ways in which Obamacare would fail and ruin America has been something of a cottage industry for conservative politicians and talking heads since the Affordable Care Act passed in 2010.

Sometimes the Obamacare haters resolutely held their ground even as the facts disproved their theories. This is known as "Obamacare trutherism".

So let's take a journey down Bonkers Lane and remember together some of the scariest prognostications about Obamacare that turned out to be untrue.

1. Prediction: No One Is Going To Pay For Health Insurance

What happened: Just About Everyone Paid For Health Insurance. After we learned that more than 8 million Americans signed up for health insurance on the Obamacare exchanges by April, it became hard to argue that no one would enroll. So conservatives moved on to a new theory: No one was actually gonna pay for it. The taker-class, 47 percenters who had latched on to the government teat were deadbeats who don't pay their bills, the argument went, basically. "But how many have paid??" they asked. Over and over.

House Energy and Commerce Republicans released a laughable "report" in April asserting only two-thirds of enrollees had paid premiums. Then they held a hearing about it, where health insurance company executives lined up to tell them they were were dead wrong, and the number was more like 80 percent to 90 percent.

Finally, after months of caginess, the Obama administration offered a real answer: 7.3 million enrollees were paid up as of Aug. 15. That's down from the 8 million announced in April, but still more than the 6 million the Congressional Budget Office predicted would sign up.

"Thank you for the health insurance. Here is my money." - Most people

2. Prediction: Premiums Are Going To Skyrocket!!

What happened: Premiums Went Up A Smidge. Maybe the loudest, most persistent prediction was that health insurance prices would go through the roof next year because so many sick people would sign up, and so few young people, that insurers would have to jack up prices -- maybe even by as much as 300 percent! And then a "death spiral" would begin and undermine the whole industry!

Back to reality: Forty-six percent of the people who bought plans on the exchanges said the plans were less expensive than the ones they had in 2013, according to a Henry J. Kaiser Family Foundation survey from March and April.

Thirty-nine percent of enrollees surveys did said their new plans were more expensive. These higher rates mainly affected younger, healthier people who earn too much money to qualify for tax credits to help pay for coverage. Eight-five percent of everyone who enrolled got these subsidies. And the increases were likely a one-time bump, mainly caused by rules making the insurance package better, so it isn't relevant to 2015. And yet...

"O-Care premiums to skyrocket," screamed a March headline in The Hill, which remains the only entity that uses the term "O-Care." FOX News was ON IT. Health insurance prices are going to double -- triple even. Trainwreck!

The basis for this shocking report? Anonymous quotes from "health industry officials." Which ones? Who knows! Stop asking questions. From The Hill:

“...I think everybody knows that the way the exchange has rolled out...is going to lead to higher costs,” said one senior insurance executive who requested anonymity.

The insurance official, who hails from a populous swing state, said his company expects to triple its rates next year on the ObamaCare exchange.

Color us rate-shocked! But wait -- what's that, consulting firm PricewaterhouseCoopers? The average premium increase on the exchanges next year will be 6 percent? (That's less than 300 percent, if you don't have a calculator handy.) That doesn't seem so bad, and is lower than typical increases for individual insurance policies before Obamacare.

This Is What's Up With Obamacare Premiums In 2015

Source: PricewaterhouseCoopers Health Research Institute

3. Prediction: Obamacare Is The Worst Thing To Happen To Young People Since Moms Joined Facebook

What Happened: A Lot Of Young People Are Insured, Pleasing Moms Everywhere. Young adults were urged to "burn their Obamacare cards" by right-wing outfits trying to disrupt Affordable Care Act implementation. Their argument: Obamacare is a bad deal for 20-somethings because they'd be paying a ton just so old people and sick people could go to the doctor. Millennials were better off paying the fine for violating the law's individual mandate than buying health insurance. And anyway, these "young invincibles" didn't even want health insurance (contrary to what they actually said in polls, but whatever).

Obamacare was designed to "screw" young adults, they were told. But in 2010, the law started allowing people to stay on their parents' health insurance policies until they turn 26, and in 2014 it began offering subsidized coverage to people with low and moderate incomes, which includes lots of young people just starting their careers. The result:

The Uninsured Rate

Among 19- to 25-Year-Olds

Source: Centers for Disease Control and Prevention via White House Council of Economic Advisers

4. Prediction: Obamacare Is INCREASING The Uninsured Rate!

What happened: Obamacare DECREASED The Uninsured Rate. Considering that the Affordable Care Act will spend about $1 trillion over a decade to subsidize health benefits and requires most people to get covered, this idea seems just plain silly. But that hasn't stopped politicians and others from expressing it aloud!

House Speaker John Boehner (R-Ohio) himself got in on the action, saying in March there was a "net loss of people with health insurance." Whoa if true.

All available evidence shows that the uninsured rate is down -- way down. According to Gallup, it hasn't been this low since the 1990s.

Source: Gallup

The Department of Health and Human Services and the Harvard School of Public Health concluded in a New England Journal of Medicine article that 10.3 million more people have health insurance this year than did last year.

5. Prediction: Obamacare Will Destroy The Private Health Insurance Industry

What happened: Health Insurance Companies Got A Lot Of New Business. A big part of this claim rests on exploiting public confusion about what "Obamacare" is, and ignoring the fact that private health insurance is what's being sold on the exchanges. (Not to mention that even "single-payer" Medicaid is largely contracted out to private insurance companies.)

Another component of this prediction was that the Affordable Care Act lays too many regulations on health insurers. And there are lots and lots of regulations, like the prohibition against rejecting customers with pre-existing conditions and the mandate for a guaranteed minimum benefits package, that insurers wish they didn't have to follow.

"Look at what we've done to eviscerate the U.S. health insurance industry," Rep. Marsha Blackburn (R-Tenn.) said on FOX News in April.

Yes, look. After the first enrollment period brought in more than 7 million paying customers and the promise of millions more in the future, health insurance companies grew more confident (even some of those, like Aetna, that expect to lose money on the exchanges in 2014).

How confident? There will be 248 more health insurance plans available on the exchanges for 2015 than there were this year, a net increase of 25 percent (including a few companies that bowed out) compared to the first enrollment period.

Not a photo of the U.S. health insurance industry

'$15 Could Change Everything': Hundreds Arrested As Fast-Food Workers Strike Nationwide

CHARLESTON, S.C. -- About two dozen of this city's fast-food workers marched Thursday afternoon to a street corner that's home to a McDonald's, a Wendy's and a KFC. Calling for a living wage of $15, they seated themselves in the middle of a freeway entrance, backing up traffic as far as the eye could see.

Charleston police were eventually forced to pull them out of the street one by one, citing them for disorderly conduct in what were deemed "non-custodial" arrests. All told, 18 people -- most of them earning right around minimum wage -- were arrested next to the McDonald's parking lot.

"I'm just tired of seeing my family struggle," Robert Brown, a 20-year-old with short dreadlocks sprouting from his McDonald's visor, said right after a cop handed him a citation ordering him to appear in court. "I can't help them at all with what I make."

The Charleston arrests were part of Thursday's nationwide protest coordinated by Fight for $15, a union-backed campaign in which workers are demanding a $15 wage and union recognition. With the support of local labor and community groups, workers have been taking part in a series of intermittent one-day strikes in various cities over the past two years, shaming big fast-food companies like McDonald's over low pay and irregular hours.

Organizers billed Thursday's strikes and protests as an escalation of the campaign through civil disobedience. Notably, the demonstrations have spread well beyond big cities like New York and Chicago, where they were originally based. On Thursday, workers took to the streets in places like Durham, North Carolina; Tucson, Arizona; and Rochester, New York, according to news reports.

A Fight for $15 spokesperson said that roughly 500 people had been arrested in the demonstrations as of Thursday afternoon, though a portion of those appeared to be citations without arrest.

In instances that HuffPost could confirm, police arrested 47 people in Kansas City, Missouri; 27 in West Milwaukee, Wisconsin; 19 in New York City's Times Square; 30 in Detroit; 11 in San Diego; 8 in Wilkinsburg, Pennsylvania; seven in Miami; and three in Denver. Police also confirmed 19 citations in Chicago; 10 in Indianapolis; 13 in Hartford, Connecticut; and 10 in Las Vegas. In most cases, the arrests and citations came after protesters were blocking traffic.

The high-profile strikes -- which tend to draw national news coverage when they happen -- have helped progressive legislators push through minimum wage hikes on the state and local level in recent months, including a $15 wage floor that will slowly go into effect in Seattle. Even President Barack Obama has held up the protests as evidence that Congress needs to hike the federal minimum wage, which hasn't been raised since 2009. The current level of $7.25 is less than half of what the Fight for $15 campaign is calling for.

"You know what? If I were looking for a job that lets me build some security for my family, I’d join a union," Obama said Monday in a Labor Day speech. "If I were busting my butt in the service industry and wanted an honest day’s pay for an honest day’s work, I’d join a union."

While the fast-food companies themselves have generally remained quiet, critics of the campaign who sympathize with the industry have tried to dismiss the protests as stunts orchestrated by the Service Employees International Union. The union has devoted millions of dollars to the campaign in an effort to bring unionism to what's generally a union-free industry.

With some exceptions, the fast-food strikes generally haven't been large enough to shut down restaurants. In fact, it isn't always clear how many of the people participating in a protest are striking workers. In Charleston on Thursday, several workers said they had the day off and wanted to take part in the protest; others told HuffPost they were missing a scheduled shift and were formally notifying their bosses they were taking part in a protected one-day strike.

Jonathan Bennett said he was supposed to be working at Arby's on Thursday.

"If we don't do this, I don't know who will," Bennett said. "$15 could change everything."

South Carolina does not mandate a minimum wage higher than the federal level. All of the workers interviewed by HuffPost on Thursday said they made less than $8 per hour at their restaurants. That works out to a full-time salary of about $16,000 per year, which is well below the poverty level for a family of three. Most workers said they don't get a full 40 hours each week, either.

As in other towns, the Charleston protest drew in just a small fraction of the city's actual fast-food workforce. But the fact that it was happening at all in South Carolina took onlookers by surprise. The state has the third-lowest union density in the nation, with little of the organized labor infrastructure that often helps lead a wage protest.

Dave Crossley, a local who came out in support of the protest, marveled at the line of workers bottling up traffic for blocks on Spring Street, chanting for "$15 and a union."

"This sort of thing doesn't happen in Charleston," he said.

Dave Jamieson reported from Charleston and Jillian Berman reported from New York.