What would happen if a companies profits just stayed the same over a period of quarters? I obviously don’t understand it at all but isn’t it just unsustainable to expect growth indefinitely?
In: Economics
Generally for shareholders. They’re buying into the company hoping their shares gain value. If the company always makes the same amount the share price won’t increase
It’s less of an issue with privately held companies, which is why there’s less pressure for those companies to increase profits every time
It is long-term unsustainable, yes, but shareholders don’t really care. In the short term it works, and people tend to like money now instead of possible money later
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