Amazon earns more than 60% of its operating profit from cloud computing, not retail sales.

Amazon Web Services (AWS) was officially launched in 2006 to provide other companies with the same infrastructure Amazon used for its own operations. By 2023, AWS reported an annual operating income of approximately $24.6 billion. This figure represented roughly 67% of Amazon's total consolidated operating profit for the entire year. The retail side of the business operates on volume and thin margins, often facing high logistics and shipping costs. In contrast, cloud computing scales efficiently because the marginal cost of adding new software users is relatively low. This allows AWS to maintain operating margins frequently exceeding 30%, while the retail division often hovers in the low single digits. Major clients like the U.S. Department of Defense, Pinterest, and Adobe rely on AWS for data storage and processing power. According to Synergy Research Group, Amazon consistently holds about 31% to 33% of the global cloud infrastructure market share. This dominance ensures that even if retail sales fluctuate, the company's financial health remains anchored by its technological services.