this post was submitted on 29 Aug 2023
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Amazon makes almost no money on retail sales. They make their money from AWS and from advertisers.
Even better then. With people WFH companies move their on-prem servers and applications to the Cloud like AWS!
No matter how you dice this Amazon is fucking itself
Amazon had $220 billion in first party online retail revenue in 2022 $117 billion from 3rd party online retail $80 billion from AWS $37 billion from advertising.
Retail is amazons primary source of revenue.
Historically Amazon has used revenue from other segments to fund new ventures. AWS is profitable now, but it only came to be from the huge numbers that retail posts.
If it was truly the case that retail has no value, it would have been ditched ages ago, but in reality, the retail segment of the company enables other segments to be profitable. High revenue gives you liquidity, and Amazon's vast infrastructure network provides lots of other opportunities for the business.
At almost zero profit
Just ignore the other two paragraphs then.
Nobody’s denying that retail enabled Amazon to get where they are today and continues to be an important aspect of the business. But the notion that increased retail demand due to remote work would be a major boon for the company’s bottom line is fundamentally flawed. If anything, sudden surges in demand tend to be costly, since their distribution network is tuned to be able to just barely meet expected demand.