It's added to Amazon's overall costs -- from transporting goods to running warehouses. The bright spot always has been Amazon's cloud computing business, Amazon Web Services (AWS). First, let's talk about how AWS generally fits into the Amazon earnings picture.
Given the beatdown growth investors had in 2022, many are now looking for reliable businesses with staying power and long-term growth potential. E-commerce stocks provide strong long-term growth prospects, given the secular trends that have supported the rise of industry juggernauts such as Amazon (NASDAQ: AMZN) over the past two decades. Rising stars in this space, such as Shopify (NYSE: SHOP), have grown in popularity as a way for small and medium-sized businesses (SMBs) to thrive in a post-pandemic environment.
Down 35% over the last 12 months, the stock of Amazon (NASDAQ: AMZN) has been a roller coaster ride for investors. This could encourage the Federal Reserve to ease off its restrictive monetary policy without tipping the U.S. economy into recession -- a scenario often called a "soft landing." For Amazon and other growth-oriented stocks, this is a huge green light because Fed policy affects investors' willingness to pay premiums for their future earnings and cash flow.