Aren't Amazon ads just sellers prioritizing their listing on the Amazon page? Seems totally different from the ad market for Google
Very niche focus for Amazon vs broader set of customers for Google ads. Seems totally different to me
Also Google competes with FB and has to split the advertising pie for those other services and businesses. Amazon owns basically the whole pie for the people who want to advertise products.
Amazon itself had negative operating margins for its retail business last quarter.
Amazon retail: "Its U.S. segment recorded $206 million in operating losses, while the international side lost $1.63 billion."
Single digit margins at best, once a market is competitive.
Edit: You edited your above, but gross margin is meaningless. It doesn't even include salaries for employees or infrastructure costs. Net margins for retail will always be slim, outside of specific first mover advantage in some subsectors.
You think the Chinese companies selling $5 rubber spatulas are making 40% margins? Lol, try 5% or less.
The theory that Amazon retail would grow revenues rapidly and then eventually expand to high operating margins will never come to fruition. Margins will be below 10% in perpetuity
But sure, ignore all costs of running the business and look at gross margins.
And Amazon retail margins is way different and in no way comparable to SELLER margins.
A quick sample of like-for-like products shows that typical sale+delivery price on amazon is 30% more than aliexpress and 18% more than ebay.
I really don't see how you can charge 30% more than a profit making competitor, sell in larger volume, yet make a loss.
I think Amazon's ambition is endless.