AMZN.US: AWS re-acceleration & ads growth

Market snapshot

Price

USD 231

Market cap

USD 2500.0B

FY2025 AWS

USD 108.0B

Forward P/E (illustrative)

35

Thesis

Amazon is the only mega-cap with a retail + cloud + ads trilogy. TTM P/E ~42x looks rich, but retail runs low-single-digit margins while profits skew to AWS (~35%+ op. margin) and ads (~60%+ margin); on SOTP, AWS + ads imply ~25–30x.

Timing: pre-earnings draft ahead of 2026-07-30—official releases govern.

Business

Model: e-commerce/fulfillment for traffic; AWS for high-margin cloud; retail media monetizes closed-loop demand.

Flagships: (1) AWS $108B FY2025 (+18%, OP ~35–37%); (2) Ads $56B (+22%); (3) NA/Intl retail—largest scale, low-single-digit margins.

Competitiveness: ~31% public-cloud share; Prime + fulfillment flywheel for retail and ads.

Strategy (12–24m): Bedrock model-neutral stack; Trainium/Inferentia; FY2026 Capex ~$100–110B for AI DCs and logistics automation.

Value chain

Position: mid/downstream platform—retail connects brands to consumers; cloud connects enterprise/AI workloads.

Upstream: GPUs/custom silicon, power/DCs, 3P sellers. Downstream: consumers, Prime, cloud customers, advertisers.

Supply-chain risks: (1) AI accelerator and power constraints; (2) labor/warehouse costs and trade friction—echoed in Risks.

Valuation

As of ~2026-07-29, price ~$231, market cap ~$2.5T; Forward P/E ~35x. AWS holds ~31% public-cloud share, ahead of Azure (~25%) and Google Cloud (~12%). FY2026 Capex ~$100–110B presses FCF to ~$35–45B near term.

Andy Jassy has led since 2021; after 2022–2024 “efficiency years,” focus shifted to AI infra and retail margin expansion. Silicon supply: NVIDIA, AMD.

Financial trend (~24 months)

Revenue and GM with YoY/QoQ. Q4 holiday retail lifts QoQ then normalizes. Recent quarters partly reconstructed from disclosures.

Revenue · last 8 quarters

Interactive chart available in the reader.

Gross margin · last 8 quarters

Interactive chart available in the reader.

Operations

FY2025: revenue $638B (+11%); North America retail $395B (+10%, OP ~5–6%); International $131B (+7%); AWS $108B (+18%, OP ~35–37%); ads $56B (+22%).

Q2 2026 (ended Jun 2026, due 2026-07-30) street ranges: revenue $165–170B (+11–13%); AWS $29–30B (+18–20%) with AI-related ~$750–800M/quarter; ads $15–16B (+22–25%); NA op. margin ~6–7%; quarterly Capex ~$26–28B.

Segment mix (FY2025 illustrative)

Segment mix (FY2025 illustrative)

Segment	Revenue mix	Watchpoint
North America retail	~62%	FY2025 ~$395B · OP ~5–6%
International retail	~21%	FY2025 ~$131B · low margin
AWS	~17%	FY2025 ~$108B · OP ~35%+
Advertising	~$56B	Mostly within retail · +22% · high margin

Competition

Cloud: Azure/GCP; retail: Walmart / Temu·Shein; ads: Google/Meta. Strengths: AWS share and closed-loop ads; weaknesses: thin retail margins, Capex vs FCF.

Peer comparison

Peer comparison

Company	Position / share	GM	Strength	Weakness
Amazon (AMZN)	Cloud ~31% / retail+ads	~50%	AWS share + closed-loop ads	Thin retail margins; heavy Capex
Microsoft (MSFT)	Azure ~25%	~69%	Enterprise + Copilot distribution	Less retail media scale
Alphabet (GOOGL)	GCP ~12%	~58%+	Search cash + Cloud acceleration	Smaller cloud share vs AWS
Walmart (WMT)	US retail peer	Lower	Stores + growing retail media	No hyperscale cloud profit pool

Management

Andy Jassy (CEO since 2021), Brian Olsavsky (CFO). No material Chair/CEO/CFO changes in 24m—stable; execution focus is AI Capex ROI and retail efficiency.

Key management (24m)

Key management (24m)

Role	Name	Since	24m change
CEO	Andy Jassy	2021-07	No change
CFO	Brian Olsavsky	2015	No material disclosed change
Chair (Exec)	Jeff Bezos (Exec Chair)	2021	No material disclosed change

Outlook

Scenarios

Risks