Amazon: What to know about the online retail giant
From its origins as an online bookseller during the 1990s, Amazon has evolved into one of the biggest publicly-held companies.
While dot com bubbles have grown and burst, Amazon has just kept growing and growing, branching out into new businesses as a leader in various industries. Here are five things to know about Amazon, the world’s largest online business:
Size
Amazon’s most well-known business is Amazon.com, which sells a tremendous number of items. It operates in countries around the world. Its Prime program offers members numerous perks, including free shipping on more than 100 million items and streaming movies and TV shows on Prime Video.
The site’s retail sales are supported by Amazon’s sprawling logistics network, which includes numerous warehouses, tractor-trailers, cargo jets and local delivery systems.
FILE - In this Thursday, Aug. 4, 2016, file photo, Amazon.com boxes are shown stacked near a Boeing 767 Amazon "Prime Air" cargo plane on display in a Boeing hangar in Seattle. (AP Photo/Ted S. Warren, File)
The company also sells its own devices, like Kindle e-readers, Fire tablets and TV accessories and Echo smart speakers. There are more than 150 products that come with Amazon’s cloud-based voice service Alexa built in. As of the end of 2018, Amazon had sold more than 100 million Alexa-enabled devices.
Amazon also offers subscriptions to its streaming services, Prime Video and Amazon Music, and members can access the content through their Amazon devices. Amazon Studios produces some of the programming for Prime Video, and it became the first streaming service to win Oscars in 2017 thanks to “Manchester by the Sea” and “The Salesman.” Writers can publish books through Amazon, selling through the company’s Kindle Store.
Another major business for the company is its Amazon Web Services, which provides a variety of back-end technical services for other websites. Amazon says AWS serves “developers and enterprises of all sizes, including start-ups, government agencies and academic institutions.”
Amazon owns Ring, the DIY home security company known for its doorbell cameras.
Ring's video doorbells are behind numerous viral videos.
It also owns the grocery store Whole Foods, which it bought in 2017 for $13.7 billion. The chain has more than 480 stores in the U.S.
Amazon also owns various other websites like Twitch, Zappos, Audible and Goodreads.
As of the end of 2018, Amazon employed about 647,500 full-time and part-time workers. The company also hires seasonal workers and independent contractors.
Amazon’s offices, physical stores, fulfillment centers and other facilities comprised more than 288 million square feet as of the end of 2018.
Finances
Amazon is listed on the Nasdaq under the symbol AMZN.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| AMZN | AMAZON.COM INC. | 207.89 | +2.15 | +1.05% |
The company is valued at more than $880 billion. It reported net sales of $232.8 billion in 2018, a 30 percent increase from the year before.
For two years in a row, Amazon paid zero federal income tax, thanks to strategic use of tax credits, deductions and a rebate. News in early 2019 of the company’s negative tax rate drew criticism, including from prominent politicians.
Third-party sellers are an important part of Amazon.com’s business, even as its own first-party sales continue to grow each year. Third-party sellers have gone from accounting for 3 percent of the website’s physical gross merchandise sales in 1999 to 58 percent in 2018 — $100 million in 1999 and $160 billion last year. Amazon says it has facilitated that growth by offering tools to help sellers manager their inventory, process payments, track shipments and sell internationally, and the company takes fees and a cut of sales.
Amazon Prime Day gives the company a big sales boost in the summer. But like many retailers, Amazon says holiday shopping drives sales. The quarter ending in December accounted for about a third of Amazon’s annual revenue for the past three years.
Founder and CEO Jeff Bezos was Amazon’s top shareholder as of April 2019, holding 12 percent of the company. That stake — even after losing a chunk of shares in his divorce — has solidified Bezos as the wealthiest person in the world, with a net worth of $131 billion, according to Forbes.
FILE- In this Aug. 3, 2017, file photo, Myrtice Harris applies tape to a package before shipment at an Amazon fulfillment center in Baltimore. Amazon's Prime Day starts July 16, 2018, and will be six hours longer than last year's and will launch new
Leadership
Bezos is Amazon’s founder, president, CEO and chairman of its board.
Amazon’s nine-member board of directors includes a business leaders from a variety of backgrounds, including members from the worlds of finance, philanthropy, media and academia.
FILE- In this Sept. 13, 2018, file photo Jeff Bezos, Amazon founder and CEO, speaks at The Economic Club of Washington's Milestone Celebration in Washington. (AP Photo/Cliff Owen, File)
History
Bezos founded Amazon in 1994 and launched the site in 1995. The first book sold on the site was Douglas Hofstadter’s “Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought.”
Amazon held its initial public offering in May of 1997. Shares went for $18, or $1.50 if you adjust for three stock splits between 1998 and ’99.
The company expanded internationally in 1998 when it launched in Germany and the U.K. It followed up in France and Japan in 2000.
Amazon Web Services launched in 2002, giving other developers access to the company’s technology.
Amazon began offering “free super saver shipping” on qualifying orders in 2003. It introduced Prime in 2005.
The original Kindle launched in 2007, starting Amazon’s line of devices.
Amazon held its first Prime Day in 2015. In 2019, the company said the shopping even was its largest ever, with sales surpassing the previous Black Friday and Cyber Monday combined.
FILE - In this Dec. 2, 2013, file photo, Amazon.com employees work the shelves along the miles of aisles at an Amazon.com Fulfillment Center on "Cyber Monday", the Monday after Thanksgiving and the busiest online shopping day of the holiday season, i
Hot issues
Amazon looks like it’s constantly growing. The company is continually expanding with retail storefront and adding new services like its Turnkey partnership, which offers homebuyers with real estate agents and then helps the new homeowners with services like unpacking, cleaning and furniture assembly.
By working across so many industries, Amazon says it faces many different competitors, such as physical and e-commerce retailers, digital content services, web infrastructure companies and transportation and logistics services.
Amazon is reportedly being investigated as part of several different probes, including one run by state attorneys general who are looking at big tech companies for potential antitrust action and another by Federal Trade Commission officials who have been looking into Amazon’s business practices.
Amazon Alexa now accepting 2020 candidate donations, but expert warns against using feature
Starting this week, Americans will be able donate as much as $200 to their favorite candidates.
The minimum wage Amazon pays its workers is $15. But employees at some company facilities have complained about working conditions, even organizing strikes around Prime Day 2019.
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The retail giant was also criticized as being wasteful after a French documentary crew went undercover and revealed that Amazon workers were tossing out large amounts of unsold goods. The company later announced that it would make excess and returned products from third-party sellers available to charities.
Amazon Scout (Photo provided)
Amazon has been working on new ways to bring goods to its customers. The company has been developing robotic delivery vehicles that can bring packages right up to customers’ front doors. Amazon has been testing its six-wheeled, cooler-sized “Scouts” in parts of Washington and California. In September, Amazon also announced that it was buying 100,000 electric delivery vans.
