Wal-Mart Stores, Inc. (WMT), Amazon.com, Inc. (AMZN), and How Corporate America Spends Its Cash

There are exceptions, of course. Amazon.com, Inc. (NASDAQ:AMZN) in recent years has pumped nearly all of its effort into investing in future, profits today be damned. “Amazon, as far as I can tell, is a charitable organization being run by elements of the investment community for the benefit of consumers,” wrote Matthew Yglesias last year.

But as CEO Jeff Bezos wrote in a letter to shareholders:

Our heavy investments in Prime, AWS, Kindle, digital media, and customer experience in general strike some as too generous, shareholder indifferent, or even at odds with being a for-profit company …

But I don’t think so.

To me, trying to dole out improvements in a just-in-time fashion would be too clever by half. It would be risky in a world as fast-moving as the one we all live in.

More fundamentally, I think long-term thinking squares the circle. Proactively delighting customers earns trust, which earns more business from those customers, even in new business arenas. Take a long-term view, and the interests of customers and shareholders align.

The irony here is that Amazon.com, Inc. (NASDAQ:AMZN) has produced greater short-term shareholder returns than the vast majority of companies, up 280% in the last five years. “Take a long-term view, and the interests of customers and shareholders align.” Wise words more CEOs may want to consider.

The article How Corporate America Spends Its Cash originally appeared on Fool.com.

Fool contributor Morgan Housel has no position in any stocks mentioned. The Motley Fool recommends Amazon.com. The Motley Fool owns shares of Amazon.com.

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