Amazon (AMZN) Last Update 10/30/23
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Trefis Price
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TREFIS Analysis

Trefis Report
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Potential upside & downside to trefis price

Amazon Company


  1. Amazon Web Services constitute 53% of the Trefis price estimate for Amazon's stock.
  2. Amazon North America constitutes 37% of the Trefis price estimate for Amazon's stock.
  3. Amazon International constitutes 9% of the Trefis price estimate for Amazon's stock.


Recent Stock Split

Amazon completed a 20-for-1 stock split on May 27, 2022.

Latest Earnings

In Q3 2023, the company posted total revenues of $143.1 billion, which is 13% more than the year-ago figure. It was driven by a 11% rise in North America sales, followed by an 16% increase in International sales.

Amazon's (NASDAQ:AMZN) Net sales for FY 2022 increased 9% to $514 billion, compared with $470 billion in the previous year. Excluding the $15.5 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the year, net sales increased 13% compared with 2021. Operating income decreased to $12.2 billion from $24.9 billion. Net income decreased to -$2.7 billion from $33.4 billion in the previous year.

Impact of Coronavirus

Amazon's retail business picked up in 2020 and 2021, as consumers preferred online contactless purchases over going to the store due to the Covid-19 pandemic. The company also incurred costs due to the pandemic as they make changes in processes and invested in equipment to make sure the employees stay healthy. That said, the growth rate slowed down in 2022, partly due to the normalizing of consumer behavior post-re-opening of offline retail stores and partly because of tough macroeconomic conditions.


Below are key drivers of Amazon's value that present opportunities for upside or downside to the current Trefis price estimate for Amazon:

Amazon Web Services

  • AWS Revenues: We currently forecast Amazon Web Services revenues to continue to increase rapidly from about $80.1 billion in 2022 to over $200.7 billion by the end of our forecast period. However, given the potential competition in the space such as Alibaba and Microsoft, coupled with the huge base factor, Amazon can witness a lower-than-anticipated growth rate. We expect the increasing use cases of edge computing to help manage competitive pressures.

  • AWS EBITDA Margin : We currently forecast Amazon's AWS EBITDA margin to touch 45% by the end of our forecast period due to relatively fixed operating expenses and high operating leverage due to economies of scale.

Amazon North America

  • Amazon North America EBITDA Margin: We currently forecast Amazon to consistently add customers for sale and subscriptions in North America leading to improved revenue per customer and resulting high margins due to economies of scale. We forecast North America EBITDA Margin to improve from just below 10% in 2022 to almost 12% by the end of our forecast period.

For additional details, select a driver above or select a division from the interactive Trefis split for Amazon at the top of the page.


Amazon is an online retailer which sells electronics, books, retail consumer goods, music, games, apparel, and other merchandise to consumers in the U.S., Canada, the United Kingdom, Germany, Brazil, France, China, Japan, India Mexico, Netherlands, Italy, and other countries. The company also provides web services such as cloud computing and online storage to websites and web developers.


Amazon Web Services business is the most valuable segment for Amazon due to the company's high growth within this segment. In recent years, consolidated AWS revenues have seen high double-digit growth. Despite the lowest revenue contribution, AWS is the most valuable segment due to the high margins of cloud computing as compared to the e-commerce retail business which operates on razor-thin margins.


Growing high-margin cloud services business

The growth in Amazon's Web Services has become a critical factor driving the company's expansion globally. Several companies continued to adopt these services in recent years. Besides helping big businesses, the company’s cost-efficient web services are also useful for young start-ups that may have cash restrictions.

The growth in the AWS segment has been massive - the annual growth in AWS revenues came in at 70% in 2015, 55% in 2016, 43% in 2017, 46% in 2018, and 29% in 2022. Apart from this, the company also showed strong profitability in the cloud-services business as margins have improved in this segment in successive years.

Heavy investments in international expansion could add pressure on profitability

Amazon is making significant investments to expand its presence in regions such as China, India, Italy, and Spain. While these investments will enhance revenue growth, however, this strategy could also raise margin pressure. Amazon will invest a couple of billion dollars in its Indian operations, but since the country’s e-commerce market is highly competitive, we believe it will be difficult for Amazon to attain profitability in the region for at least a couple of years.