Under limited circumstances, depending heavily on what is causing the loss, sometimes this can be effective for very few companies. Of course, many people unrealistically believe that their circumstances apply, that the cause of the loss is irrelevant, and that it will be effective for them. Most are wrong.
Losing money per transaction is dangerous. Making money per transaction but plowing the profits into expansion is less dangerous. The latter is what Amazon did. The former is what too many companies are doing, not seeing the difference.
There is theoretically a scenario in which a company might temporarily lose money on each transaction due to scale, but over the long term manage to lower costs so that each transaction is profitable. Even that, I'd say it's dangerous to count on that, but it's not completely impossible.
I think that's different from dumping, which I consider to be a more deliberate attempt to outlast a competitor.
