Why technology companies don't report high net income from the use of GAAP?
The article GAAP vs. Non-GAAP: What's the Difference? says:
Technology companies have been large users of non-GAAP adjustments as these companies typically don't report high net income from the use of GAAP, due to the nature of their businesses.
Could you please explain why the nature of their businesses causes them to have low net income?
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The nature of their businesses is that they are not making money.
They use non-GAAP accounting to persuade investors to give them money. In many ways, it is financial marketing.
Often, they are not making money because they are spending alot to try to grow quickly in a competitive market.
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