- Amazon’s revenues per minute were $837,330.25 in Q1 2021.
- Insider Intelligence’s report The Power of Amazon report assesses 19 different business units and predicts where they’ll be in five years.
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Whenever Amazon announces that it is entering a market, competitors start gaming out what it means for their own business. How will the dynamics shift? How will Amazon leverage its other divisions to gain an advantage? How will this change Amazon’s business model?
Our analysts—who closely follow the industries in which Amazon operates—examined 19 of the company’s various divisions and where they are currently. We assessed how the divisions complement and reinforce one another to retain both shoppers and businesses within the Amazon ecosystem, often doing so by banking on tech-driven convenience and consumer centricity.
Amazon revenue outlook 2021
Amazon’s revenues per minute were $837,330.25 in Q1 2021, per CNBC. The company joined the $1 trillion market cap club in early 2020 and has the first-mover advantage for several businesses, most notably as a commerce platform and a marketing powerhouse.
We forecast that Amazon’s share of US ecommerce sales in 2021 will be 41.4%; next in line is Walmart with a 7.2% share. The global pandemic accelerated several digital trends where Amazon excels, including ecommerce, delivery services, cloud computing, digital payments, home security, streaming entertainment, and online advertising.
The company has seen significant revenue growth from both old and new business lines over the past few years—Amazon annual revenue surpassed $386 billion worldwide in 2020.
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Amazon Prime keeps customers within the ecosystem
One of Amazon’s key advantages is its ability to use its various business divisions to support and drive the growth of other divisions. At the heart of the flywheel is Amazon Prime—a subscription service that includes a wide variety of perks such as discounts on select items, expedited shipping, and online videos, games, and music, to name a few.
Amazon launched Prime in 2005 with the offer of unlimited two-day shipping for $79 per year on a wide selection of products housed on the retailer’s site. Six years later, Amazon added Prime Video, giving subscribers access to ad-free movies and TV shows.
In 2014, the company raised Amazon Prime’s price to $99 and started experimenting with adding more services—some of which, like Prime Pantry and Prime Now, were aimed at facilitating repeat household item purchases but have been discontinued as standalone services. Then, in 2015, Amazon created its own shopping holiday, Prime Day, now a multiday event that generated $11.19 billion in sales worldwide for the company in 2021, according to Digital Commerce 360.
We forecast that the number of US Amazon Prime households will reach 81.4 million in 2021, up 4.8% year over year (YoY). Put another way, nearly two-thirds (63.4%) of all US households will have an Amazon Prime membership this year. To put that in perspective, we estimate that in 2016, 44.8 million US households—35.6% of all households—had Amazon Prime. We forecast that those numbers will grow to 90.2 million and 68.0% by 2025.
Amazon’s revenue breakdown
Insider Intelligence analysts poured over Amazon data and market information to outline 19 of the company’s major business divisions and revenue streams:
- Retail Ecommerce
- Amazon Pay
- Non-Ecommerce Retail
- Just Walk Out
- Amazon Pharmacy
- Fulfillment by Amazon
- Amazon Business
- Business Payments
- Amazon Web Services
- Amazon One
- Ring Home Security
- Echo and Alexa
- Kindle and Fire Tablet
- Fire TV
The Power of Amazon report evaluates which of Amazon’s business divisions are truly forces to be reckoned with; which of those divisions leverage Amazon’s market dominance to establish themselves in new industries; and which are experiments that help Amazon test, learn, and iterate to improve other parts of the flywheel.