Amazon's Global E-commerce Dominance: A Brief Overview

Amazon is a global e-commerce leader with three main product categories: electronics, cultural products, and other services. Its net sales are primarily driven by sales of services (52.7%) and sales of products (47.3%). The company's sales are geographically distributed across the US (69.3%), Germany (6.5%), the UK (5.9%), Japan (4.7%), and other regions (13.6%).

Amazon, a global e-commerce leader, has been aggressively expanding its cloud services through Amazon Web Services (AWS). In the second quarter of 2025, AWS reported 18% year-over-year growth, reaching $30.8 billion in revenue and contributing $10.2 billion in operating income [1]. This underscores AWS's pivotal role in Amazon's profitability.

Amazon's latest move is the launch of the AWS Asia Pacific (New Zealand) Region, backed by a NZ$7.5 billion investment and three Availability Zones. This new region addresses critical needs such as low latency, data residency compliance, and generative AI capabilities, appealing to sectors like finance, healthcare, and government [1]. The region includes services like Amazon Bedrock and Amazon Q, further strengthening AWS's AI-driven value proposition.

Beyond infrastructure, AWS has signed a memorandum of understanding (MoU) to train 100,000 New Zealanders, aligning with national priorities and accelerating local adoption [1]. By placing infrastructure onshore, AWS removes friction for regulated industries and positions itself as a premium platform for AI, ML, and analytics workloads, driving higher-margin growth.

The global Cloud Computing Market is expected to reach $1.9 trillion by 2030, growing at an 18.7% compound annual growth rate, fueled by AI and ML adoption [1]. AWS plans to capture this growth by adding 10 new Availability Zones and three additional Regions in Chile, Saudi Arabia, and Europe, expanding its global footprint to 120 AZs across 38 regions [1].

While the New Zealand region may deliver a near-term revenue boost, its strategic impact is significant, unlocking local demand, enabling sustainable cloud adoption, and deepening AWS’s APAC dominance [1]. Over time, these investments compound into a durable growth driver for Amazon’s cloud business.

Amazon's cloud business faces rising competition from Microsoft Azure and Google Cloud Platform. Microsoft Azure surpassed $75 billion in revenues in fiscal 2025, growing over 34% year over year [1]. Alphabet Inc.'s Google Cloud revenues rose 31.7% year over year to $13.62 billion, pushing its annual run rate above $50 billion [1].

AMZN shares have gained 4.3% in the year-to-date period, underperforming the Zacks Internet – Commerce industry and the Zacks Retail-Wholesale sector’s growth of 13.2% and 8.6%, respectively [1]. From a valuation standpoint, AMZN stock appears overvalued, trading at a forward 12-month Price/Sales ratio of 3.23X, higher than the industry’s 2.3X [1]. The Zacks Consensus Estimate for AMZN’s 2025 earnings is pegged at $6.73 per share, reflecting an upward revision of 6% in the past 30 days and 7.2% over the last 60 days [1].

References:
[1] https://www.nasdaq.com/articles/amazon-eyes-cloud-expansion-will-nz-aws-region-drive-growth