Amazon's Darkest Hour: Bill Miller Sees Opportunity in Despair

Bill Miller, former manager of Legg Mason Value Trust, made headlines in 2001 when he doubled down on Amazon shares at just $6 each. This was despite Wall Street's predictions that the company would go bankrupt.

Miller's reasoning was based on Amazon's cash flow statement, which showed a core business generating positive free cash flow with minimal inventory risk.

He remembered asking Jeff Bezos about his priorities and being told that he focused on maintaining a 'bulletproof' balance sheet. By 2002, Bezos shifted focus to customer experience, which Miller saw as Amazon moving from defense to offense.

Miller's decision to buy more shares paid off spectacularly, with Amazon returning over 82,169% from October 2001. His personal portfolio was heavily weighted towards Amazon by 2020, making him the largest individual shareholder outside of the Bezos family at that time.