While Amazon will probably always be seen as an e-commerce company first, its business has undergone a remarkable transformation in recent years. In the past quarter, services accounted for nearly 40 percent of Amazon's revenue, up from 26 percent three years earlier. Maybe most surprising to many though, is the fact that Amazon's greatest hit is neither Amazon Prime, nor the company's namesake e-commerce platform, but a B2B cloud service named Amazon Web Services.
As our chart illustrates, Amazon’s profit has largely been driven by its cloud business in recent years. Amazon Web Services (AWS), the leader in the highly competitive market for cloud infrastructure
, accounted for 58 percent of the company’s operating profit in the past quarter, despite contributing only 10 percent to the company's net sales.
For many years, Amazon has reinvested nearly every dollar
it earned in its long-term growth. Considering that the company's profit just soared to an all-time high, it seems like even Jeff Bezos is running out of ideas to reinvest all of it.