Microsoft is another example of this, considering it owns a wide range of hardware, cloud services, and platforms. Other tech giants generate revenue through a range of products, services, and applications-for instance, while a healthy portion of Apple’s revenue comes from iPhone sales, the company captures 17% of revenue from a mix of services, ranging from Apple Pay to Apple Music. Amazon is Not Alone: Diversification is CommonĪmazon isn’t the only major tech company to benefit from diverse revenue streams. While third-party sellers technically outsold Amazon itself, the company still makes money through commission and shipping fees. In 2018, it accounted for 58% of gross merchandise sales on Amazon, compared to just 3% in 2000. This segment has shown tremendous growth over the last two decades. For instance, enabling third-party sellers on the platform is the company’s second-largest unit in terms of net sales, racking up $63 billion over the course of a year. While ecommerce makes up a large portion of Amazon’s overall sales, there are many other segments that each generate billions in revenue to create immense value for the tech giant. In 2020, Prime Day is projected to generate almost $10 billion in global revenue. Over the period of June 2019 to 2020, product sales from Amazon’s website generated $163 billion, which is more than the company’s other business units combined.Ī significant day for online sales is Prime Day, which has grown into a major shopping event comparable to Black Friday and Cyber Monday. While Amazon is truly more than an online store, it’s worth noting that online sales account for a significant amount of the company’s overall revenue mix. Here’s a breakdown of Amazon’s revenue mix: retail sales by the end of 2020-but the tech giant is more than just a one-trick pony.Ī key factor in the company’s success is its diversification into other areas. The company is expected to account for 4.6% of total U.S. With a market cap of $1.7 trillion, Amazon is currently the most valuable retailer in the world. This visualization provides an overview of the different parts that make up Amazon, showing each business unit’s net sales from June 2019 to 2020. While ecommerce makes up a significant portion of the company’s overall sales, its diverse revenue model generates billions through various business segments. Visualized: A Breakdown of Amazon’s Revenue ModelĪmazon has evolved into more than just an online store.
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