Amazon isn't making any money yet. Maybe in future they will make some. I don't like using AWS (I just don't know why), I prefer Microsoft Azure and Digital Ocean.
Amazon makes TONS of money. They aren't currently returning any of it to shareholders as profits, they're continuously reinvesting it in the company.
The difference between gross profit and net profit is how much Amazon is spending on building new businesses that after a few years start grossing $10b a year in sales like AWS. That got funded out of the gross profits from regular Amazon retail operations.
I'd have thought comparing funding expanding Amazon's data centre capacity from revenue is very comparable to Tesla building out it's manufacturing capability the same way.
Amazon has also been doing a bunch of capital lease shenanigans so they could expand AWS without having to report GAAP losses over the last few years.
Walmart's market cap is ~250B, whereas Amazon is $350B.
Amazon had $100B sales last year, Walmart had $500B.
If Amazon can generate profit at the same rate as Walmart then Amazon needs to get to $700B in sales for that valuation to make sense...
If Amazon double's in value again it would have to have sales representing 10% of US GDP at the same profitability level as Walmart.
Smells like a speculative bubble to me.
See here: http://finance.yahoo.com/echarts?s=AMZN+Interactive#{"range"...
http://www.geekwire.com/2014/ex-microsoft-ceo-steve-ballmer-...
http://money.cnn.com/infographic/technology/gates-ballmer-mi...
Further, AWS is a money printing machine. It's generating over $700 million in operating income per quarter, and that's growing very fast. It'll be at $5+ billion per year in operating income within perhaps just two or three more years. There aren't very many technology businesses anywhere producing that kind of operating income.
But if you _do_ need that, like we do, it's bloody brilliant.