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Amazon.com Inc AMZN

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Consumer Behavior in Coronavirus Unlocks New Revenue/Margin Opportunities for Amazon; FVE to $3,500

R.J. Hottovy, CFA Sector Strategist

Analyst Note

| R.J. Hottovy, CFA |

There was little doubt that Amazon was going to report a surge in coronavirus-related sales growth during second quarter, but the magnitude of the sales outperformance ($88.9 billion dollars in revenue, up 40%, versus guidance of $75-$81 billion) and operating profit upside ($5.8 billion versus guidance of negative $1.5 billion to $1.5 billion) make this a paradigm-shifting update.

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Company Profile

Business Description

Amazon is among the world's highest-grossing online retailers, with $281 billion in net sales and approximately $365 billion in estimated physical/digital gross merchandise volume (GMV) in 2019. Online product and digital media sales accounted for 50% of net revenue in 2019, followed by commissions, related fulfillment and shipping fees, and other third-party seller services (19%), Amazon Web Services' cloud computing, storage, database, and other offerings (13%), Prime membership fees and other subscription-based services (7%), product sales at Whole Foods and other physical store retail formats (6%), and advertising services and cobranded credit cards (5%). International segments constituted 27% of Amazon's non-AWS sales in 2019, led by Germany, the United Kingdom, and Japan.

Contact
410 Terry Avenue North
Seattle, WA, 98109-5210
T +1 206 266-1000
Sector Consumer Cyclical
Industry Internet Retail
Most Recent Earnings Jun 30, 2020
Fiscal Year End Dec 31, 2020
Stock Type Cyclical
Employees 798,000

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