30 Sep 2011

Amazon

To understand Amazon as a business/stock, it is important to understand it is at least two almost completely different businesses.  

-Media, which accounts for ~45% of revenue and is growing ~10% y/y, and is going through a massive transition to digital goods where the main competition is going to be Apple, Google, Netflix, cable companies, etc.
Screen_shot_2011-09-30_at_5
- Everything else (known as "EGM" - "Electronics and General Merchandise") which accounts for ~52% of revenue, is growing ~24% y/y, and where Amazon is mainly competing with specialty e-commerce sites and (primarily) offline retailers like Walmart.
Screen_shot_2011-09-30_at_5
The stat I find surprising is how much room there is to grow.  Amazon's share of (global) e-commerce is ~8.3%.  E-commerce is only ~6% of global retail.  Hence Amazon's share of total global retail is ~0.5%.