Amazon (AMZN): What This Company Actually Does

How Amazon makes money

Third-party sellers and brands supply products; Amazon's retail and fulfillment operation (North America + International) sells and ships them to consumers, who also pay for Prime membership. Advertisers pay separately to be seen in Amazon's marketplace. And enterprises and developers rent computing power and AI infrastructure from AWS, which runs at a 35% operating margin — high-margin cash that funds both retail investment and AI infrastructure (2026 capex is guided around $200B).

Simplified — advertisers and AWS enterprise/developer customers are separate revenue streams alongside retail. Source: 10-K FY2025, p.3–4, p.27; Q2 FY2026 earnings call (Jul 30, 2026).

Where the revenue comes from

Source: 10-K FY2025, p.24 (revenue), p.27 (operating income).

Source: 10-K FY2025, p.69 (Note 10 — Segment Information), p.24 (currency impact).

Customers and competitors

Customers span consumers (B2C, Prime members), third-party sellers (who pay fees), enterprises and developers (who pay for AWS), and advertisers. No single customer dominates revenue — filings don't disclose any customer topping 10% (exact concentration figures aren't broken out).

• Microsoft Azure, Google Cloud — direct competitors to AWS in cloud and AI infrastructure.
• Walmart — a retail heavyweight combining physical and online, competing on price and delivery speed.
• Temu, Shopify, and other emerging e-commerce players — ultra-low-cost and new entrants eroding both Amazon sellers and shoppers.

Source: 10-K FY2025, p.3–4 (Item 1, Competition).

The metric that matters most in this sector

AWS generates only 18% of Amazon's revenue but more than half of its total operating income. Whether that gap narrows (retail profitability improving) or widens (deepening AWS dependence) is the clearest read on where Amazon's profit is really headed.

*2022's figure exceeds 100% because North America and International combined posted an operating loss that year — AWS alone earned more than the company's total operating income. Source: 10-K FY2025 (2024–25), 10-K FY2024 (2023), 10-K FY2022 (2021–22), segment tables.

Leadership and ownership

Andy Jassy has been CEO since July 2021 — an internal executive who built AWS from the ground up. Founder Jeff Bezos stepped down as CEO in 2021 but remains involved as Executive Chair. Bezos, at 8.8%, is the largest individual shareholder (Jassy himself holds under 0.1%); Vanguard (7.2%) and BlackRock (5.9%) are the largest institutional holders.

Source: DEF 14A 2026, p.44–45; 10-K FY2025, p.5.

Capital returns

Amazon has never paid a dividend. It approved a $10 billion buyback program in March 2022, but repurchased zero shares in 2023, 2024, and 2025 — three straight years — leaving $6.1B of that authorization untouched. Meanwhile, total shares plus RSUs outstanding actually rose from 10.8 billion (2023) to 11.0 billion (2025): dilution from employee compensation is running ahead of any offsetting buyback activity.

Source: 10-K FY2025, p.62 (Note 8, Stock Repurchase Activity).

How this company could fail

• A massive AI infrastructure bet — 2026 cash capex is guided around $200B, sharply above 2025's $131.8B. The effect is already visible: free cash flow fell from $38.2B (2024) to $11.2B (2025). If AI returns fall short of that spending, cash flow gets squeezed further.
• Intensifying competition — AWS faces aggressive AI-infrastructure competition from Azure and Google Cloud, while retail keeps fighting price battles with Walmart, Temu, and Shopify.
• Regulatory and litigation risk — Amazon paid a $2.5B FTC settlement in Q3 2025, faces an ongoing Italian tax dispute, and remains under antitrust scrutiny in multiple countries.

Source: 10-K FY2025, p.24–28 (FTC settlement, FCF), p.6–7 (Item 1A risk factors); Q2 FY2026 earnings call (Jul 30, 2026) for capex guidance.

Five-year financials

Source: 10-K FY2025, p.28 (FCF reconciliation), p.36 (cash flow), p.39 (balance sheet); 10-K FY2022, p.28, p.39 (2021–2022 figures).

What we still don't know

• Whether the ~$200B AI infrastructure investment pays off, and on what timeline, isn't something these filings settle — AWS operating margin trends on upcoming earnings calls are the place to check.
• Today's exact share price and market cap aren't in this card — the most recent confirmed figure is an Aug 3, 2026 close of $287.20, when Amazon's market cap crossed $3 trillion; anything since needs separate verification.
• Exactly how much U.S. tariff and trade policy affects revenue and cost of goods sold isn't quantified in the 10-K.