A profit margin is the share of each sale a company keeps as profit. Amazon's margin is low next to other large tech companies, because most of its sales come from stores and deliveries, which cost a lot to run. It has been rising, because delivery costs have fallen as a share of sales and the cloud and advertising businesses have grown.
The margin that matters most for a shareholder is the operating margin: the profit from running the businesses, before interest and tax. It is also the number that most shapes what investors expect Amazon to earn, and so the share price that tokenized Amazon follows through the AMZNX/USDT Spot pair.
What is Amazon's profit margin?
Amazon's operating profit margin was 11.2% in 2025. It kept $80.0 billion of operating income from $716.9 billion of sales (source: Amazon 2025 Form 10-K). In the second quarter of 2026 the margin was 13.7%, on $27.5 billion of operating income from $200.6 billion of sales (source: Amazon Q2 2026 Form 10-Q).
Operating margin is operating income divided by sales. Operating income is what is left after the costs of running the businesses. Those costs are the goods Amazon sells, its warehouses and shipping, its technology, its marketing and its head office. Operating income leaves out interest, tax, and gains or losses on investments.
Net margin is net income divided by sales, and in 2026 it tells you much less. Amazon's net income includes gains on its stakes in other companies, above all Anthropic, the AI company. In the second quarter of 2026, net income was $62.6 billion, more than twice the operating income, because other income was $53.4 billion (source: Amazon Q2 2026 Form 10-Q). A net margin for that quarter would be over 31% (source: Amazon Q2 2026 Form 10-Q), and none of the extra came from selling anything.
Say you want one number to follow from quarter to quarter. Use the operating margin, and compare it with the same quarter a year earlier. In the second quarter of 2025, Amazon's operating margin was 11.4%, on $19.2 billion of operating income from $167.7 billion of sales (source: Amazon Q2 2026 Form 10-Q). So the margin rose by more than two percentage points in a year. The same quarter a year earlier is the fair comparison, because Amazon's sales swing with the seasons, and the holiday quarter is always the biggest.
Why Amazon's retail margin is thin
Amazon reports three segments: North America, International and AWS, its cloud computing business. The two retail segments keep only a few cents of each dollar of sales, while AWS keeps more than a third. In 2025, North America's operating margin was 6.9%, International's 2.9% and AWS's 35.4% (source: Amazon 2025 Form 10-K).
In the second quarter of 2026 the three margins were 7.9%, 4.1% and 39.4% (source: Amazon Q2 2026 Form 10-Q).
A thin margin leaves little room for a rise in costs. Say you add one cent of cost to every dollar of sales in each segment. North America, with $426.3 billion of sales and $29.6 billion of operating income in 2025, would lose about $4.3 billion, a seventh of its profit. AWS, with $128.7 billion of sales and $45.6 billion of operating income, would lose about $1.3 billion, less than a thirtieth of its profit (source: Amazon 2025 Form 10-K).
Selling goods also means running warehouses and a delivery network. In 2025 Amazon's fulfillment costs were $109.1 billion and its shipping costs $102.7 billion, together about 30% of its sales (source: Amazon 2025 Form 10-K). Amazon's annual report puts the 2025 rise in North America's operating income down mainly to selling more units and more advertising, with part of the gain eaten by higher fulfillment, shipping and technology costs (source: Amazon 2025 Form 10-K).
Advertising sits inside Amazon's retail segments, and Amazon does not report its profit on its own. So the retail margins blend the sale of goods with advertising and seller fees, and because an advertisement in the store needs no warehouse space or delivery, more advertising can lift those margins without any change in the cost of delivery.
How Amazon's margin has changed since 2020
Amazon's operating margin fell to 2.4% in 2022, its lowest since at least 2020 (source: Amazon 2022 Form 10-K). It then rose every year, to 6.4% in 2023, 10.8% in 2024 and 11.2% in 2025 (source: Amazon 2025 Form 10-K), and reached 13.7% in the second quarter of 2026 (source: Amazon Q2 2026 Form 10-Q).
The retail segments drove most of the turn. North America went from a loss in 2022 (source: Amazon 2022 Form 10-K) to a 4.2% margin in 2023 and 6.9% in 2025 (source: Amazon 2025 Form 10-K). International took a year longer: after losses in 2021, 2022 and 2023, it returned to profit in 2024 (source: Amazon 2022 Form 10-K) (source: Amazon 2025 Form 10-K).
From 2020 to the middle of 2026, AWS kept between 27% and 40% of its sales as operating income. North America ranged from a small loss to 7.9%, and International from a loss of 6.6% of sales to a profit of 4.1% (source: Amazon 2022 Form 10-K) (source: Amazon 2025 Form 10-K) (source: Amazon Q2 2026 Form 10-Q).
Period | Amazon overall | North America | International | AWS |
|---|---|---|---|---|
2020 | 5.9% | 3.7% | 0.7% | 29.8% |
2021 | 5.3% | 2.6% | −0.7% | 29.8% |
2022 | 2.4% | −0.9% | −6.6% | 28.5% |
2023 | 6.4% | 4.2% | −2.0% | 27.1% |
2024 | 10.8% | 6.4% | 2.7% | 37.0% |
2025 | 11.2% | 6.9% | 2.9% | 35.4% |
Q2 2026 | 13.7% | 7.9% | 4.1% | 39.4% |
In 2022, AWS earned more than the whole company. Its $22.8 billion of operating income was larger than Amazon's total of $12.2 billion, because the two retail segments together lost $10.6 billion (source: Amazon 2022 Form 10-K). By 2025 the retail segments earned $34.4 billion between them. AWS's share of the total fell to 57%, even though its own profit had doubled since 2022 (source: Amazon 2022 Form 10-K) (source: Amazon 2025 Form 10-K).
How regional fulfillment cut delivery costs
One of the largest costs in Amazon's retail business is shipping, and its share of sales has fallen since 2021. Shipping costs, which include sorting and delivery centers and transport, were 16.3% of sales in 2021 (source: Amazon 2022 Form 10-K) and 14.3% in 2025 (source: Amazon 2025 Form 10-K).
Amazon reports shipping costs in the discussion of results in each annual report, not as a line on the income statement. There, most of them sit inside cost of sales, together with the price Amazon pays for the goods it sells (source: Amazon 2022 Form 10-K) (source: Amazon 2025 Form 10-K) (source: Amazon 2024 Form 10-K).
Year | Shipping costs | Net sales | Shipping as a share of sales |
|---|---|---|---|
2021 | $76.7 billion | $469.8 billion | 16.3% |
2022 | $83.5 billion | $514.0 billion | 16.2% |
2023 | $89.5 billion | $574.8 billion | 15.6% |
2024 | $95.8 billion | $638.0 billion | 15.0% |
2025 | $102.7 billion | $716.9 billion | 14.3% |
In the second quarter of 2026, shipping cost $27.9 billion (source: Amazon Q2 2026 Form 10-Q). That was 13.9% of the quarter's sales. Amazon's 2023 letter to shareholders gives one reason for the fall. It had reorganized its US network by region, to store goods closer to customers. That "trimmed transportation distances", and in 2023 Amazon's cost to serve each unit fell for the first time since 2018. In the US alone, it fell by more than $0.45 per unit (source: Amazon 2023 letter to shareholders).
Cost to serve is Amazon's term for what it costs to get an item to a customer. A lower cost per unit, across billions of units, is how a few cents become billions of dollars of operating income.
Robots and same-day sites
Amazon says it now has more than one million robots working in its fulfillment centers. They stow, pick and sort goods and move them around inside the buildings. Its purchase of Kiva, a robotics company, in 2012 sped up that work (source: Amazon 2025 letter to shareholders).
The same letter describes a new, more streamlined type of warehouse built for same-day delivery. Amazon has built more than 85 of these same-day sites in the US. They carry its 90,000 best-selling items. By the time of the letter, they had delivered more than 500 million same-day units in 2026 (source: Amazon 2025 letter to shareholders).
Amazon presents robots as a way to deliver faster and to cut the cost of carrying more selection, but the letter gives no figure for the savings. The annual reports do show the total cost. Fulfillment expense covers the warehouses and the people in them, physical stores, customer service and payment processing. It was 16.4% of sales in 2022 and 15.2% in 2025 (source: Amazon 2022 Form 10-K) (source: Amazon 2025 Form 10-K), which is where it stood in 2020 (source: Amazon 2022 Form 10-K).
Say you want to see what that change is worth. On 2025's $716.9 billion of sales, fulfillment at 2022's 16.4% of sales would have cost about $117.6 billion. At 15.2% it cost $109.1 billion, about $8.5 billion less. Amazon's annual report lists its level of productivity among the reasons this ratio moves, alongside the mix of products and services sold (source: Amazon 2025 Form 10-K). So part of the $8.5 billion is better productivity in the warehouses, and part is that AWS and advertising, which need little warehouse work, grew faster than the stores.
The letter also says Amazon has committed over $4 billion to expand delivery in rural areas (source: Amazon 2025 letter to shareholders). Amazon says remote communities are more expensive to serve, so this is a cost it has chosen to carry while it builds that network.
Fewer corporate layers, and a bigger cloud business
Amazon has also cut office jobs. On October 28, 2025, it told staff it would cut about 14,000 corporate roles. The aim was less bureaucracy and fewer layers (source: Amazon, October 28, 2025). On January 28, 2026, it cut about 16,000 more corporate roles (source: Amazon, January 28, 2026).
The January cuts came from teams that had not finished that work in October. Amazon said it did not plan to announce broad reductions every few months (source: Amazon, January 28, 2026).
The total number of employees barely moved. Amazon employed about 1,541,000 people at the end of 2022, 1,556,000 at the end of 2024 and 1,576,000 at the end of 2025 (source: Amazon 2022 Form 10-K) (source: Amazon 2024 Form 10-K) (source: Amazon 2025 Form 10-K). Sales grew by nearly 40% over those three years. By June 30, 2026, Amazon had about 1,595,000 employees, 3% more than a year earlier, while its sales for the quarter were up 20% (source: Amazon Q2 2026 results release). More sales from almost the same workforce is one way operating leverage shows up: costs grow more slowly than sales. A company with high fixed costs, such as warehouses and data centers, sees this most clearly, because each extra sale uses capacity it has already paid for.
The other driver is the mix of businesses. AWS and advertising grew faster than the stores, and neither needs a warehouse: AWS keeps more than a third of each dollar of sales, and advertising's own profit is not reported. AWS's sales rose from $80.1 billion in 2022 to $128.7 billion in 2025. Its operating income rose from $22.8 billion to $45.6 billion over the same years (source: Amazon 2022 Form 10-K) (source: Amazon 2025 Form 10-K).
Advertising grew from $37.7 billion to $68.6 billion over the same three years (source: Amazon 2022 Form 10-K) (source: Amazon 2025 Form 10-K), growth of 82% against nearly 40% for Amazon's sales as a whole. Amazon's advertising business is therefore a growing share of what the retail margins blend together.
Amazon's margin against Walmart, Alphabet and Meta
Amazon's margin sits between a store chain's and a software company's, because it is both. Walmart kept 4.2% of its sales as operating income in its year to January 31, 2026 (source: Walmart fiscal 2026 Form 10-K). Alphabet, whose profit comes mostly from advertising, kept 34% in the second quarter of 2026 (source: Alphabet Q2 2026 results).
Meta, the other large advertising company, kept 31% in the same quarter (source: Meta Q2 2026 results). The periods differ, because Walmart's year ends in January while Amazon, Alphabet and Meta report by calendar quarter (source: Walmart fiscal 2026 Form 10-K) (source: Amazon 2025 Form 10-K) (source: Amazon Q2 2026 Form 10-Q) (source: Alphabet Q2 2026 results) (source: Meta Q2 2026 results).
Company | Period | Operating margin |
|---|---|---|
Walmart | Year to January 31, 2026 | 4.2% |
Amazon | Year to December 31, 2025 | 11.2% |
Amazon | Second quarter of 2026 | 13.7% |
Meta | Second quarter of 2026 | 31% |
Alphabet | Second quarter of 2026 | 34% |
The gap to Alphabet and Meta is mostly about what is being sold. Their sales are advertising and software, which cost little to deliver once built. Most of Amazon's sales are physical goods and the work of delivering them. Meta's margin also shows how quickly a high margin can fall when spending rises. It was 43% in the second quarter of 2025, twelve points higher than a year later (source: Meta Q2 2026 results).
Against Walmart, Amazon's margin is higher mainly because of AWS, which a store chain does not have, and the gap shows in any Amazon and Walmart stock comparison (source: Amazon 2025 Form 10-K). Without AWS, Amazon kept 5.8% of its 2025 sales as operating income (source: Amazon 2025 Form 10-K). That is much closer to Walmart's 4.2%, and Walmart also sells advertising and runs a marketplace (source: Walmart fiscal 2026 Form 10-K).
Wherever the margin settles between Walmart's and Alphabet's, it reaches AMZNX/USDT through Amazon's share price, and the spot fee on each trade depends on your account tier in the BloFin fee schedule.
What rising margins mean for an AMZNX holder
AMZNX follows the Amazon share price, and the share price follows what investors expect Amazon to earn. A higher margin on the same sales means more operating income, so margin is one of the lines to read on every results day, alongside the other forces that move Amazon's stock price.
Say Amazon's sales in a quarter are $200 billion. At an 11.4% operating margin, like the second quarter of 2025, that is about $22.8 billion of operating income. At 13.7%, like the second quarter of 2026, it is about $27.4 billion. The extra 2.3 percentage points are worth about $4.6 billion of operating income a quarter, on the same sales. Investors turn expected profit like this into a share price through measures such as Amazon's price-to-earnings ratio.
Two things can push the margin down again. The first is depreciation, a yearly charge for wear on buildings and equipment. Amazon's spending on data centers adds to it, and Amazon allocates most of its infrastructure costs to AWS, based on usage (source: Amazon 2025 Form 10-K). The second is pressure on the stores. A price war in retail, or a slower economy, would press on the thin retail margins first.
Holding AMZNX and trading the AMZNUSDT Perpetual are the two ways to take Amazon exposure on BloFin. Which of the two to use depends on how you want to hold it.
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Frequently asked questions
What is Amazon's net profit margin?
Amazon's net margin was 10.8% in 2025: $77.7 billion of net income on $716.9 billion of sales (source: Amazon 2025 Form 10-K). Gains and losses on its investments can push it either way. In 2022 Amazon made $12.2 billion of operating income but a net loss of $2.7 billion, a net margin of about −0.5%, largely because its stake in Rivian lost $12.7 billion in value (source: Amazon 2022 Form 10-K). In 2026 the Anthropic stake is doing the opposite (source: Amazon Q2 2026 Form 10-Q).
Is Amazon making money or losing money?
Amazon has made an operating profit in every year since at least 2020, including $80.0 billion in 2025 (source: Amazon 2025 Form 10-K). Its operations also bring in more cash than before: operating cash flow was $161.4 billion in the twelve months to June 30, 2026, up 33% (source: Amazon Q2 2026 results release). Amazon's free cash flow, which subtracts spending on property and equipment, was still an outflow of $7.6 billion over those twelve months (source: Amazon Q2 2026 results release).
What profit margin do Amazon sellers make?
Seller margins are a different measure from Amazon's own. A seller keeps what is left after the product cost, Amazon's referral and fulfillment fees, advertising and returns, and that depends on the product. Amazon's fee revenue from sellers is part of its own sales. Third-party seller services brought in $172.2 billion in 2025 (source: Amazon 2025 Form 10-K).
What is Amazon's gross margin?
Amazon's gross profit was $360.5 billion in 2025, or 50.3% of sales: net sales of $716.9 billion less cost of sales of $356.4 billion (source: Amazon 2025 Form 10-K). Amazon itself says operating income is a more meaningful measure than gross profit and gross margin, because its products and services are so varied. Fulfillment, for example, sits below gross profit, so the gross margin leaves out one of its largest costs.
Will Amazon's margins keep rising?
Amazon does not forecast margins. Its results release each quarter gives a range for operating income and sales (source: Amazon Q2 2026 results release), and its quarterly report says its capital spending will rise in 2026 (source: Amazon Q2 2026 Form 10-Q). Higher spending brings more depreciation, which weighs on margins. Its 2025 letter to shareholders points the other way, to robots that help it deliver faster and carry more selection at a lower cost (source: Amazon 2025 letter to shareholders). Which side wins shows up in the segment margins each quarter.
Researched and written by the BloFin Academy editorial team with AI-assisted drafting. All facts independently verified. Primary sources include Amazon's annual reports for 2022, 2024 and 2025, its second-quarter 2026 quarterly report and results release, its 2023 and 2025 letters to shareholders, its October 28, 2025 and January 28, 2026 announcements, Walmart's fiscal 2026 annual report, and Alphabet's and Meta's second-quarter 2026 results, current as of September 28, 2026.
Nothing in this article constitutes financial advice, and nothing in it is a recommendation to buy, sell or hold Amazon in any form. Amazon's retail margins are thin, 6.9% in North America and 2.9% abroad in 2025, so a small rise in costs can erase a large share of their profit. Rising depreciation from its data-center spending can lower the margin even while sales grow. AMZNX follows Amazon's share price, so a token holder bears the same risks. Past performance does not indicate future results. Do your own research and consider your risk tolerance before you trade on BloFin.