Negative

From Nasdaq: 2025-04-18 09:45:00

Amazon (NASDAQ: AMZN) faces challenges in the trade war with China, with U.S. tariffs on Chinese goods reaching 145%. However, Amazon’s profits don’t heavily rely on its e-commerce business. Subscription and ad services contribute significantly to profit margins, mitigating potential losses from tariff impacts.

Amazon’s e-commerce platform heavily sources goods from China, but its profits are diversified. While commerce revenue may face challenges, Amazon’s ad and subscription services contribute significantly to profits. Additionally, Amazon’s cloud computing division, AWS, is a major profit driver, with high margins and long-term growth potential.

In Q4, Amazon’s online stores and third-party seller services generated $123.1 billion in revenue, while ad and subscription services brought in $28.8 billion. AWS accounted for 58% of Amazon’s operating profit margin in 2024, demonstrating its importance to the company’s overall profitability.

Investing in Amazon stock may be a smart move despite trade war concerns. The company’s strong profit margins from diverse revenue streams, including cloud computing and subscription services, position it well for continued growth. AWS’s dominance in cloud computing and AI services further bolster Amazon’s long-term prospects.



Read more at Nasdaq: President Trump’s 145% China Tariffs Will Hurt Amazon. Here’s Why I’m Still Buying the Stock.