How Amazon's Diverse Businesses Help It Thrive
When Jeff Bezos founded Amazon (NASDAQ: AMZN) in 1994, it started as an online bookstore. But over the last 26 years, the company has not only become the largest e-commerce retailer in North America, but also expanded into other markets as well. And that diversity has been one of Amazon's greatest strengths, helping the company achieve a valuation that currently exceeds $1.5 trillion. Here's why Amazon's varied businesses still hold plenty of potential for investors.
Currently, Amazon owns nearly 39% of the e-commerce market in the U.S., while Walmart (NYSE: WMT) ranks second with just over 5%. That's a staggering lead, especially since Walmart is the largest retailer in the world by revenue. But Amazon's first-mover advantage has helped it stay ahead of the competition, allowing the company to build a substantial fulfillment and logistics network, and to amass an enormous consumer base. Today, nearly 50% of internet users in the U.S. start their search with Amazon when shopping online, and the number is even higher for members of Amazon's Prime subscription service. As a result, Amazon's market share is actually getting bigger, and its e-commerce revenue growth has accelerated during the pandemic.
Source: Amazon SEC filings. E-commerce includes online stores and third-party seller services. TTM: trailing-12-months.
Source Fool.com
