A snapshot of Shutterfly.Com

 http://www.businessweek.com/the_thread/dealflow/archives/2006/06/a_snapshot_of_s.html

It had $84 million in 2005 revenue. It made $28.9 million in net income, but before you break out the checkbook to buy shares, $24 million and change came from a one-time tax benefit and a “change in accounting principles.” For the last three years, it has basically been a 55% gross margin business, which gives them plenty of room to make money if they can make their technology and marketing spending scale. But so far they really haven’t — operating margins have stayed in the 6-7% of revenue range even as the company has doubled in size, so that 2003 operating profits of $2.1 million grew only to $4.4 million by last year, even as sales went from $31 million to $84 million. That’s pretty ho-hum for a growth company just passing the tipping point into profitability. Actually, it’s very ho-hum as tipping-point stories go.