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Company Snapshot : Amazon

  • Jun 2nd, 2017
Amazon.com

About : Amazon.com is an international e-commerce company offering online retail, computing services, consumer electronics, digital content as well as other local services such as daily deals and groceries. Amazon also operates ‘Pay with Amazon’, a payment processing service and ‘Amazon Business’, a members-only B2B website which sells business supplies and other products at wholesale prices and in bulk quantities to businesses. Apart from selling the product of tremendous types, Amazon also produces consumer Electronics like Kindle, E-readers, Fire Tablets, Fire TV, and Echo-a voice-controlled speaker and world's largest provider of cloud infrastructure services (IaaS and PaaS). Amazon sells a vast variety of product and also include certain low-end products like USB cables under brand AmazonBasics.

Operations

Australia China France Canada Brazil
Germany India Italy Japan Mexico
Netherlands Spain United Kingdom    

Number of Employees:  341,400

Leadership Team:   

  • Founder, CEO, President & Chairman:  Jeff Bezos
  • Senior Vice President & CFO:                  Brian T. Olsavsky
  • Vice President and Indian Head:             Amit Agarwal

History: Amazon was founded by Jeff Bezos in 1994. It started out as a bookstore and later included Movie and TV shows, and has gone on to expand to various category of products including e-readers, electronics, apparels, food, software, etc. The company launched its e-commerce platform in India in June 2013.

Amazon Subsidiaries

Amazon Musics Amazon Drive Whispercast Amazon Fresh
AbeBooks Amazon Business Amazon Video Direct Fabric
Amazon Web Service Amazon Inspire  Shopbop Amazon Rapids
East Dane TenMarks.com Prime Photos ComiXology
Box Office Mojo Withoutabox Woot IMDbPro
DPReview AmazonGlobal 6pm Warehouse Deals
Prime Now Souq.com Home Service Subscribe with Amazon
IMDb Junglee.com Book Services Alexa
Kindle Direct Publishing Audible Book Depository Amazon Restaurants
CreateSpac  ACX Goodreads  

Amazon Web Service:  Amazon Web Services is a subsidiary of Amazon.com and provides on-demand cloud computing platforms to both individuals, companies, and governments. AWS comprised more than 70 services spanning a wide range including compute, storage, networking, database, application analytics, development, management, mobile, developer tools, and tools for the Internet of Things and the most popular include Amazon Elastic Compute Cloud (EC2) and Amazon Simple Storage Service (S3).AWS is the fastest-growing and by far the most profitable segment of Amazon's overall business. Amazon web service has threats from Microsoft, Oracle, and Alphabet’s Google as a strong competitor.

Important Facts about AWS: 

  • Amazon Web Services (AWS) is the market leader in the cloud infrastructure services industry with a 33.8% global market share in Feb' 2017.
  • AWS accounted for 8 percent of Amazon's $44.68 billion in total revenue for Q4 2016.
  • With $926 million in operating income for Q4 2016, AWS accounted for more than 71 percent of Amazon’s $1.3 billion in operating income.
  • For the four years, 2013 to 2016, AWS has generated 77.0% of Amazon.com’s operating income before interest and tax (EBIT) and for Q1-2017, AWS generated 77.5% of EBIT for Amazon.com.
  •  AWS has been a leader in the market since 2006, owing to its wide array of Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (IaaS) offerings.

CEO of Amazon Web Service:  Andrew Jassy ( The highly paid Amazon Executive and drawn higher salary even from Amazon founder and CEO Jeff Bezos in 2016)

Operations of AWS: Amazon Web Service has distinct operations in the following 16 geographical regions

North Verginia Ohio Oregon Northern California Northwest United States
Cananda Brazil Ireland Frankfurt London
Tokyo Seoul Singapore Mumbai Sydney
Beijing        

Competitors of AWS: 

  • Amazon Web Services (U.S.)
  • IBM Corporation (U.S.)
  • Microsoft Corporation (U.S.)
  • VMware, Inc. (U.S.)
  • HP Enterprise Company (U.S.)
  • Google, Inc. (U.S.)
  • Oracle Corporation (U.S.)
  • Rackspace Hosting, Inc. (U.S.)
  • EMC Corporation (U.S.)
  • Dropbox, Inc. (U.S.).   

Competitors of Amazon:

  1. In the Media segment - Amazon competes with auction site eBay, Netflix, Time Warner Cable, Apple with iTunes, Google with its Play Store and media producer Liberty Interactive.
  2. In the electronics and general merchandise segment - Best Buy, Family Dollar, RadioShack, Staples, Target, Walmart, Sears, Big Lots, Delia, and Systemacs.
  3. In online competition in the electronics and general merchandise segment - Alibaba Group, LightInTheBox Holding Co., Overstock.com, PCM, Vipshop Holdings, JD.com, Wayfair Inc. and Zulily.
  4. In the other operating segment - Amazon competes with several of the world's largest companies including CDW, PC Connection, Insight Enterprises, Google, Oracle; salesforce.com, Accenture and Citrix Systems, Microsoft, IBM etc.

Competitors of Amazon E-commerce in India: 

  1. Flipkart: An online e-commerce company, Headquartered in Bangalore, India. Founded by Sachin Bansal and Binny Bansal in 2007 is Funded by Venture capital funds, Accel India and Tiger Global. 
  2. Snapdeal: An Online shopping site Headquartered in New Delhi, India. Founded by Kunal Bahl and Rohit Bansal in February 2010, Snapdeal is being funded by Nexus Venture Partners and Indo-US Venture Partners, Bessemer Venture Partners.
  3. Myntra: A Bangalore-based e-commerce marketplace for fashion and lifestyle products founded in 2007 by Mukesh Bansal along with Ashutosh Lawania and Vineet Saxena. In 2014  the merger of Myntra with another Indian e-commerce giant Flipkart in an estimated deal of ₹2,000 crore was taken place.
  4. Paytm: Launched in the year 2010 by Vijay Shekhar Sharma, based out of Delhi NCR, this Indian e-commerce site started off with just online mobile, electricity bills and DTH recharge facility. But after 4 years, it launched the paytm wallet which became an unstoppable craze amongst the audience. Exclusive Cashback attracts a lot of buyers to its sites and thus give a stiff competition to other e-commerce sites. In 2015, Paytm became the first Indian company to receive funding from Chinese eCommerce company Alibaba, after it raised over $625 million at a valuation of $1.5 billion.
  5. Jabong: It is an India fashion and lifestyle e-commerce portal founded byPraveen Sinha, Lakshmi Potluri, Arun Chandra Mohan.In July, 2016 Flipkart acquired Jabong through its unit Myntra for about $70 Million and after the acquisition, Ananth Narayanan was declared the new CEO of Jabong.

Mergers & Acquisitions

Company

Type

Deal Amount

Transaction Year

Souq.com

Largest e-commerce site in the Arab world

Undisclosed

 2017

Emvantage Payments Pvt. Ltd

Indian payments company

Undisclosed

 2016

Twitch

Video platform for video game

$970 million

2014

Kiva Systems

Warehouse robot systems

$775 million

2012

Quidsi

Online retailer

$545 million

2010

Zappos

Online shoes

$928 million

2009

Exchange.com

Online book marketplace

$645 million

1999

Amazon.com Revenue and Profit & Loss

Year

Net Revenue in Billions( U.S $)

Net Profit/Loss (U.S $)

2016

135.99

2.37 B

2015

107.01

596 M

2014

88.99

-241 M

2013

74.45

274 M

2012

61.09

- 39 M

Amazon.in (India) Revenue and Profit & Loss

Year

Net Revenue (in Rs. Crores)

Net Profit/Loss (in Rs. Crores)

2016

2275

-3572

2015

1022

-1724

2014

169

-321

Market Share:

  • Amazon had 43% market share of all online retail sales in US for the year 2016.
  • Amazon India had the market share of 44.6% in e-commerce industry in March 2017.
  • Amazon is dominating the voice-controlled speaker market with its Echo-branded speakers will have 70.6 percent of all voice-enabled speaker users in the U.S. in year 2017, well ahead of Google Home’s 23.8 percent and other, smaller players like Lenovo, LG, Harmon Kardon, and Mattel, who combined only account for 5.6% of users.
  • Amazon Web Services (AWS) accounts for 1/3 of the cloud infrastructure market, with a 33.8% global market share in Feb' 2017, while its three nearest competitors Microsoft, Google, and IBM together accounted for 30.8 percent of the market, according to analyst Canalys.
  • Worldwide Revenue Market Share for Amazon Web Service in Q4 2016 was around 41%

Awards:  

  • Amazon won the  prize of "Most Reputable Company" operating in America three year in a row from 2014-16 by "Reputation Institute" (RI)
  • In the 11th edition of "India's Buzziest Brands", Amazon emerges as the brand with the maximum buzz around it for the year 2015-16 conducted by "afaqs.com".
  • Amazon won 4 Awards across 14 categories  at "Golden Cart Awards 2016"

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