If Amazon can't make delivering tangible goods to people in exchange for money profitable without slopping money over from the near infinite slush fund that is cloud computing, then it is using market position to stifle competition and deserves to be broken up so Walmart, Target, Best Buy, etc. have a fighting chance of staying in business to keep prices down via competition.
The going theory here is that they dont have to make money shipping people shit and still own most of the marketplace because of the giant sloshy bucket of money from AWS.
Source? They kept their profit margins near zero during their retail only days, but Walmart/Target/Kroger/etc have only ever earned 2% to 5% profit margins anyway.
If their reports claim AWS profits are now offsetting losses in retail, then I guess their retail division has started losing money in the last few years for some reason. Which is odd given COVID landing in their lap.