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1. Company Snapshot

1.a. Company Description

Amazon.com, Inc.engages in the retail sale of consumer products and subscriptions through online and physical stores in North America and internationally.The company operates through three segments: North America, International, and Amazon Web Services (AWS).


Its products offered through its stores include merchandise and content purchased for resale; and products offered by third-party sellers The company also manufactures and sells electronic devices, including Kindle, Fire tablets, Fire TVs, Rings, Blink, eero, and Echo; and develops and produces media content.In addition, it offers programs that enable sellers to sell their products in its stores; and programs that allow authors, musicians, filmmakers, Twitch streamers, skill and app developers, and others to publish and sell content.Further, the company provides compute, storage, database, analytics, machine learning, and other services, as well as fulfillment, advertising, and digital content subscriptions.


Additionally, it offers Amazon Prime, a membership program.The company serves consumers, sellers, developers, enterprises, content creators, and advertisers.Amazon.com, Inc.


was incorporated in 1994 and is headquartered in Seattle, Washington.

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1.b. Last Insights on AMZN

Negative drivers include a $200 billion capital expenditure plan for AI infrastructure, sparking concerns over near-term cash flow, and high market multiples compared to the tech and AI sectors. Daiwa Securities Group lowered its price target, citing these concerns. The company's shift towards aggressive spending on AI, custom silicon, robotics, and infrastructure has spooked investors, with some analysts viewing it as a strategic strength, while others see it as a risk, according to a Strong Buy rating from some analysts, such as the one from February 20.

1.c. Company Highlights

2. Amazon's Earnings Report: A Strong Performance Across Segments

Amazon reported $213.4 billion in revenue, a 12% year-over-year increase excluding foreign exchange rates, with operating income of $25 billion. The actual EPS came out at $1.95, slightly lower than estimates of $1.97. The company's trailing twelve-month free cash flow was $11.2 billion. Worldwide operating income was $25 billion, including three special charges that reduced operating income by $2.4 billion.

Publication Date: Feb -08

📋 Highlights
  • Revenue Growth:: Amazon reported $213.4 billion in revenue, a 12% year-over-year increase excluding foreign exchange impacts, with operating income of $25 billion.
  • AWS Acceleration:: AWS revenue grew 24% year-over-year to $35.6 billion, achieving a $142 billion annualized run rate and triple-digit growth in its chips business ($10+ billion in revenue).
  • AI Stack Expansion:: Amazon Bedrock reached a multibillion-dollar annualized run rate, with customer spend growing 60% quarter-over-quarter, while AI chips like Trainium are fully subscribed.
  • Advertising Surge:: Advertising revenue hit $21.3 billion, a 22% year-over-year increase, with $12 billion in incremental ad revenue added in 2025.
  • Capital Investment:: Amazon plans $200 billion in capital expenditures, primarily for AWS, to meet demand for AI and core workloads, including 30 satellite launches in 2027 for its LEO network.

Segment Performance

North America revenue was $127.1 billion, up 10% year over year, with an operating income of $11.5 billion and an operating margin of 9%. International segment revenue was $50.7 billion, up 11% year over year, excluding foreign exchange, with an operating income of $1 billion and an operating margin of 2.1%. AWS revenue was $35.6 billion, with 24% year-over-year growth, and an operating income of $12.5 billion.

AWS and AI Investments

AWS growth accelerated to 24%, the fastest in thirteen quarters, with a $142 billion annualized run rate business. Amazon's AI stack, including Amazon Bedrock, SageMaker, and Trainium, saw significant growth, with Bedrock reaching a multibillion-dollar annualized run rate and customer spend growing 60% quarter-over-quarter. The company plans to invest about $200 billion in capital expenditures across the company, predominantly in AWS, to meet high demand for core and AI workloads.

Valuation and Outlook

Amazon's current P/E Ratio is 29.0, and the P/S Ratio is 3.14. Analysts estimate next year's revenue growth at 11.6%. The company's ROIC is 10.71%, and ROE is 21.87%. With a strong performance across segments and significant investments in AI, Amazon is well-positioned for future growth.

Guidance and Future Plans

For Q1, net sales are expected to be between $173.5 billion and $178.5 billion, with a favorable impact of approximately 180 basis points from foreign exchange rates. Operating income is expected to be between $6.5 billion and $21.5 billion. The company expects a year-over-year cost increase related to Amazon LEO in the North America segment.

Innovation and Expansion

Amazon is working on efficiencies, including regionalization in its fulfillment network, getting more units into each box, and robotics. The company has over a million robots in its fulfillment network and expects to continue to improve productivity and cost efficiencies. AWS is seeing broad use of AI across its businesses, including shopping assistants, Alexa, and advertising.

3. NewsRoom

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Prediction: This Will Be Amazon's Stock Price in 5 Years

06:55

Source: fool.com

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LetPot Achieves Amazon Best Seller Status Across Multiple Markets in 2025 Holiday Season

04:05

Source: globenewswire.com

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Amazon Buys Robot Maker RIVR to Win Last-Mile Delivery Race

01:50

Source: pymnts.com

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Amazon acquires Rivr, maker of a stair-climbing delivery robot

Mar -19

Source: techcrunch.com

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Should You Really Buy Artificial Intelligence Stocks Right Now? Evidence is Piling Up and Here's What it Says.

Mar -19

Source: fool.com

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Amazon acquires startup Rivr to test robots for 'doorstep delivery'

Mar -19

Source: cnbc.com

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Nvidia to sell 1 million chips to Amazon by end of 2027 in cloud deal

Mar -19

Source: reuters.com

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CEO Andy Jassy Delivers Fantastic News for Amazon Stock Investors!

Mar -19

Source: fool.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (17.89%)

6. Segments

North America

Expected Growth: 11.4%

Amazon’s North America operations will continue to grow driven by increasing adoption of online shopping, expanding e-commerce capabilities, and the company’s strong dominance in the region.

International

Expected Growth: 23.5%

Amazon’s International segment is expected to grow driven by increasing cross-border e-commerce, expansion in emerging markets, and growth in online shopping penetration, particularly in regions like Europe, Latin America, and Asia.

Amazon Web Services (AWS)

Expected Growth: 33.8%

Amazon Web Services (AWS) drives growth through its leadership in cloud infrastructure, expanding portfolio of cloud-based services, and strong traction with enterprises, startups, and government agencies, leveraging its brand reputation, scalability, and cost-effectiveness.

7. Detailed Products

Online Retail

Amazon.com is an e-commerce platform that allows customers to browse and purchase a wide variety of products, including books, electronics, clothing, and more.

Amazon Web Services (AWS)

AWS is a cloud computing platform that provides a range of services, including computing power, storage, databases, analytics, machine learning, and more.

Alexa and Echo Devices

Alexa is a virtual assistant AI technology that powers Echo smart speakers and other devices, allowing users to control their smart home, play music, and access information with voice commands.

Prime Video

Prime Video is a streaming service that offers a vast library of movies, TV shows, and original content, including exclusive Amazon Original series and movies.

Amazon Fresh

Amazon Fresh is a grocery delivery service that allows customers to order fresh produce, meat, dairy products, and other essentials, with same-day or next-day delivery.

Audible

Audible is an audiobook platform that offers a vast library of audiobooks, podcasts, and original content, with features like Whispersync for seamless switching between devices.

Amazon Advertising

Amazon Advertising is a platform that allows businesses to advertise their products and services on Amazon.com, including sponsored products, sponsored brands, and sponsored displays.

8. Amazon.com, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Amazon's business model is highly diversified, making it difficult for substitutes to emerge. The company's strong brand recognition and customer loyalty also reduce the threat of substitutes.

Bargaining Power Of Customers

Amazon's customers have some bargaining power due to the availability of alternative e-commerce platforms. However, the company's strong brand recognition and customer loyalty mitigate this power to some extent.

Bargaining Power Of Suppliers

Amazon's suppliers have limited bargaining power due to the company's massive scale and negotiating power. The company's ability to source products directly from manufacturers also reduces supplier power.

Threat Of New Entrants

The threat of new entrants is low due to the significant barriers to entry in the e-commerce industry. Amazon's strong brand recognition, large customer base, and established logistics network make it difficult for new entrants to compete.

Intensity Of Rivalry

The e-commerce industry is highly competitive, with many established players competing for market share. Amazon faces intense rivalry from companies like eBay, Walmart, and Google, which increases the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 43.36%
Debt Cost 3.95%
Equity Weight 56.64%
Equity Cost 9.72%
WACC 7.22%
Leverage 76.56%

11. Quality Control: Amazon.com, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Build-A-Bear Workshop

A-Score: 6.0/10

Value: 5.5

Growth: 6.7

Quality: 7.2

Yield: 5.0

Momentum: 8.5

Volatility: 3.0

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AutoZone

A-Score: 5.9/10

Value: 4.4

Growth: 7.2

Quality: 5.9

Yield: 0.0

Momentum: 8.5

Volatility: 9.3

1-Year Total Return ->

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eBay

A-Score: 5.9/10

Value: 3.3

Growth: 6.1

Quality: 7.0

Yield: 4.0

Momentum: 8.5

Volatility: 6.3

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O'Reilly Automotive

A-Score: 5.9/10

Value: 3.2

Growth: 7.4

Quality: 6.0

Yield: 0.0

Momentum: 8.5

Volatility: 10.0

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Tractor Supply

A-Score: 5.2/10

Value: 2.6

Growth: 7.3

Quality: 5.4

Yield: 3.0

Momentum: 4.5

Volatility: 8.7

1-Year Total Return ->

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Amazon

A-Score: 5.2/10

Value: 1.9

Growth: 8.8

Quality: 6.8

Yield: 0.0

Momentum: 7.0

Volatility: 7.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

208.76$

Current Price

208.76$

Potential

-0.00%

Expected Cash-Flows