Amazon.com Inc (AMZN)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 36.05% | 32.16% | 27.22% | 27.12% | 26.68% |
| Operating profit margin | 10.76% | 6.45% | 2.40% | 5.32% | 5.96% |
| Pretax margin | 10.75% | 6.56% | -1.16% | 8.15% | 6.29% |
| Net profit margin | 9.29% | 5.32% | -0.53% | 7.13% | 5.55% |
Amazon.com Inc has shown steady improvement in its gross profit margin over the years, increasing from 26.68% in December 2020 to 36.05% in December 2024. This indicates the company's ability to efficiently generate profit from its core operations.
In terms of operating profit margin, Amazon.com Inc experienced fluctuations, with a decline in 2022 to 2.40% but then a significant improvement to 10.76% in December 2024. This demonstrates the company's capacity to control operating expenses and increase profitability over time.
The pretax margin of Amazon.com Inc fluctuated over the period, hitting a low of -1.16% in 2022 but rebounding to 10.75% by December 2024. This shows the company's ability to manage its income before tax and indicates its overall financial health and efficiency in generating profits.
On the net profit margin front, Amazon.com Inc showed a negative value in 2022 at -0.53%, suggesting the company faced challenges in generating profits after accounting for all expenses and taxes. However, there was significant improvement to 9.29% by the end of December 2024, indicating a strong recovery and increased profitability.
Overall, Amazon.com Inc's profitability ratios demonstrate a mixed performance but with an overall positive trend, highlighting its ability to efficiently manage costs and generate profits over the years.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 10.98% | 6.98% | 2.65% | 5.92% | 7.13% |
| Return on assets (ROA) | 9.48% | 5.76% | -0.59% | 7.93% | 6.64% |
| Return on total capital | 20.26% | 15.65% | -1.68% | 21.37% | 20.64% |
| Return on equity (ROE) | 20.72% | 15.07% | -1.86% | 24.13% | 22.84% |
Amazon.com Inc's profitability ratios show a mixed performance over the past five years.
- Operating return on assets (Operating ROA) decreased from 7.13% in 2020 to 5.92% in 2021 before a significant drop to 2.65% in 2022. However, it rebounded to 6.98% in 2023 and further improved to 10.98% in 2024, indicating fluctuations in the company's ability to generate operating income from its assets.
- Return on assets (ROA) fluctuated over the same period, starting at 6.64% in 2020, peaking at 7.93% in 2021, then dropping to -0.59% in 2022, before recovering to 5.76% in 2023 and reaching 9.48% in 2024. The negative ROA in 2022 is a concerning sign as it indicates that the company's net earnings were negative relative to its total assets.
- Return on total capital also displayed variability, with percentages of 20.64% in 2020, 21.37% in 2021, a significant decline to -1.68% in 2022, followed by improvements to 15.65% in 2023 and 20.26% in 2024. The negative return on total capital in 2022 signals that the company's capital investments did not yield positive returns during that year.
- Return on equity (ROE) followed a similar pattern, beginning at 22.84% in 2020, rising to 24.13% in 2021, then dropping to -1.86% in 2022. Subsequently, the ROE increased to 15.07% in 2023 and 20.72% in 2024. The negative ROE in 2022 indicates that the company's shareholders experienced a loss relative to their equity investment in the company.
Overall, the profitability ratios of Amazon.com Inc reflect a volatile performance with fluctuations in the company's ability to generate returns on its assets, total capital, and equity over the specified period. Investors and stakeholders may need to closely monitor these ratios to assess the company's financial health and future prospects.