Probably, but could overlap if you believe that they got ahead by cutting corners; I imagine that their practice of commingling inventory nets them a nice improvement in efficiency while making the counterfeiting issue worse.
I wonder if the online marketplace by it self still doesn’t turn profit. Probably impossible to figure out with additions of services like Prime and Amazon Fresh.
For most of its history Amazon reinvested all of its excess revenue; the "Amazon wasn't profitable" soundbite is misleading. Amazon made money, and spent it on buying and building more Amazon instead of distributing dividends to shareholders. On paper that is "zero profit" _for shareholders_.
I looked this up just to make sure — it definitely, definitely is the majority of their revenue. Net sales on Amazon.com for Q1 2021 were $75 billion. AWS and “other” combined were $19 billion. [1]
As far as profit goes, you have a stronger argument — $6 billion vs. $4 billion for AWS alone. AWS has a 30% operating margin, jesus.
That kind of makes sense, though. The tail risk of something like AWS must to be significant in comparison, so a hefty margin to insure against that seems reasonable.
Sale and distribution of things is probably much milder in its variations, and the expenses seem like they'd be more strongly correlated with revenue.
(All of this is a speculative attempt at explaining the figures, not an authoritative source on strategy. Say I have a 70 % belief.)
Why would the tail risk of AWS be so high? Apart from the economic troubles of COVID which increased online buying, normal periodic economic downturn would be expected to hit all retail businesses fairly hard. Amazon's non retail unit AWS grew significantly throughout the 2008-2010 economic downturn.
I don't know. It feels like the demand from complex software systems would fluctuate more wildly than a relatively predictable human consumer base, but I could be way off the mark.