Your post is inaccurate. WalMart still beats Amazon handsomely in terms of revenue, not to mention, Amazon only recently shifted to profitability, and now their growth is declining.
This notion that Amazon has retail market capture or is close to market capture is completely inaccurate.
Walmart generates $500B in revenue compared to Amazon's $230B. While you aren't wrong that Walmart is doing well, comparing net profit between companies when one is 2x the size of the other is dishonest. It's especially dishonest when guidance from Amazon was a net decrease as they invested into 1 day shipping.
Yeah that's not true... Amazon's net income for the last quarter (ending on May 31 2019) was 3.561B, while Walmart's net income for the last quarter (ending on April 31 2019) was $3.842B
Direct revenue comparison between Wal-mart and Amazon makes no sense. Amazon revenues are a lot more diversified than Walmart.
Portions like AWS, Digital and 3P/FBA service revenues will have much higher margins than first party retail revenues (which is the most like Wal-mart revenues, except the margins are completely different due to no having brick-and-mortar stores.). Additionally, Amazon is a lot more international than Wal-mart so comparison is even harder.
All of this completely ignore the growth rates of these two companies.
Let's not get carried away here. In the most recent quarter, Walmart had revenues of $123B vs Amazon's $38B. Walmart still has time to figure out the ecommerce game.
If this was the only thing that mattered for businesses, we wouldn't have Amazon as Walmart has consistently produced more net profit over Amazon since the last 22 years. 1
Revenue of a general purpose retailer/ecommerce is not comparable to revenues of other types of companies. The margins on that revenue is always going to be miniscule
Walmart isn't the biggest company on earth by most means.
Last quarter, Walmart reported $31.8B profits on $123.4B earnings.
For the similar quarter, Amazon reported $14.5B profits on $38.0B earnings. So Walmart dwarfed Amazon overall.
Amazon's fresh results are great, and it helps to close the gap between them, but they are still much smaller than Walmart.
Unless you're talking online-only, in which case the comparison switch around, and Amazon is already much bigger than Walmart. But Walmart's online sales are a small percent of their earnings.
I think Amazon has one major advantage over Walmart: they don't care about profits and generally run things at break even. This in itself is super powerful, b/c Amazon investors can take their profits by selling the stock (e.g. capital gains) whereas Walmart needs to pay dividends from profits.
A decline in profit will lead to a significant hit in the stock price for Walmart.
Ok, so let's ask Amazon: they are both profitable and have a business model (further, for years running now, they've been able to demonstrate profitability whenever they feel like it to satisfy Wall Street worries). Their retail business has always had low margins, no different than Walmart by comparison.
Walmart revenue is $514 billion. Amazon revenue is $232 billion. Currently, about half of the retail revenue of Amazon is marketplace sales, where Amazon does not own the merchandise but simply warehouses it on consignment and charges fulfillment fees, or in some cases simply places a drop-ship order for it.
Wal-Mart's Q4/2014 net income was 16,363,000 and they have a P/E of 14.6.
Amazon's Q4/2014 net income was -241,000 and they had a P/E of, well, they didn't.
I think Amazon has been one of the most innovative companies of the last decade, but Amazon is going to be a much less attractive consumer option as they start transitioning to business models that require them to actually profit.
I could steal all the lawn mowing business in town if I were willing to mow lawns for free...
I don't know why this is getting down-voted. Amazon's enterprise value is about $220 billion, Walmart's about $275 billion. I.e. Walmart is worth about $50 billion more than Amazon.
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