Technology’s Profit Picture

Profitability became the holy grail for tech investors after the last dotcom collapse, when people got burned for piling into companies that didn’t make a dime, and in some cases didn’t even generate revenue.

Analysts proclaimed the sector in the midst of a healthy recovery in the mid-2000s partly because people favored the stocks of companies that actually made money.

When a spate of unprofitable startups held initial public offerings last year, economists and tech bears said those IPOs were evidence of froth in the sector. Amazon.com’s earnings results added fuel to the fire. Even after posting a string of quarterly losses, the company’s stock rose, evidence that a strong camp of investors continue to believe that making money, even for public companies, can wait.

Since profits are a canary in the coal mine for some tech investors, we were curious to see just how many companies that recently entered the public markets are in the black.