Latest Lie: 2007 First Quarter Numbers Were GAAP


Yesterday Sam Antar printed a very interesting piece on his blog that sharply criticized the 2008 first quarter earnings release of (NASDAQ:OSTK). I picked up the most damaging part of it, which related to Overstock claiming a 27% increase in revenue over 2007. The problem was that 2008 was calculated in a different way than 2007, so the numbers are not comparable. First quarter 2008 numbers got a “bump” that made the quarter’s increase over the prior year look bigger than it should.

But leave it to Overstock to make matters worse. An article today on says the following: Continue reading Year-End Revenues Fall Far Short of Byrne’s Hype


If Patrick Byrne is good at anything, it’s hyping (NASDAQ:OSTK) when the company is not deserving of the hype. To hear him tell it in real time, everything is rosy and the company is doing stellar and investors will surely be impressed. (It’s only a couple of years later that he admits to “screwing up” the company.)

The fourth quarter earnings release showed quarterly revenue up 2% to $300 million, and annual revenue down 2% to $768.8 million. Neither of these are particularly impressive.

And they are even less impressive when you look at them in conjunction with an interview Patrick Bryne gave CNBC on December 7, 2007. According to the company’s press release about the interview: Continue reading

More on the Accounting Shenanigans


Patrick Byrne Overstock Accounting IrregularitiesThis year, Patrick Byrne and company have taken a liking to discussing the (NASDAQ: OSTK) financials using non-GAAP measures. This means that they present certain financial figures that are not computed in accordance with GAAP (accounting rules).

Who cares? As long as they disclose that they’re non-GAAP measures, it doesn’t matter, right? Wrong. You see, companies use non-GAAP measures for one of two things: Continue reading and its phony earnings figures


Patrick Byrne, CEO of O.coToday on the White Collar Fraud Blog, Sam Antar has the first part of a three part series on the inventory numbers at It’s curious how Overstock’s inventory numbers always seem to create more questions than they answer.

Sam has some insight into this. As the former CFO of Crazy Eddie, a company that eventually folded after a massive fraud was uncovered, he says that one of the keys to perpetrating the fraud for as long as they did was deflecting attention away from suspicious items. Always put the focus back on the positive; keep everyone looking away from the negative.

In that vein, Overstock’s CEO Patrick Byrne (who is the target of a federal investigation) seems adept at doing exactly that. Unless, of course, a fraud investigator or investigative reporter is looking at his numbers. Continue reading