amazon-revenue-per-employee

Amazon Revenue Per Employee

Amazon had 1,541,000 full-time and part-time employees in 2022, generating $333,539 per employee, compared to over $292,000 in 2021.

Amazon Employees1,541,000 full-time and part-time employees
Revenues per Employee$333,539
Analysis by FourWeekMBA
Key Facts
FounderJeff Bezos
Year & Place FoundedJuly 5, 1994, Bellevue, WA
Year of IPO5/15/1997
IPO Price$18.00
Total Revenues at IPO$15.75 million
Total Revenues in 2022$514B
Analysis by FourWeekMBA

Revenue per employee in Big Tech

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  • Tesla:
    • Revenue per employee declined from 2019 to 2020, but then increased significantly in 2021 and 2022.
    • Tesla experienced the highest percentage increase in revenue per employee from 2020 to 2022 (43.0%).
  • Google:
    • Revenue per employee remained relatively stable between 2019 and 2020, but then experienced a significant increase in 2021.
    • However, Google’s revenue per employee decreased in 2022 compared to 2021, but still remained higher than 2019 and 2020.
  • Amazon:
    • Revenue per employee decreased from 2019 to 2020 and continued to decrease in 2021, reaching its lowest point.
    • In 2022, Amazon’s revenue per employee rebounded, but it was still below the 2019 level.
  • Apple:
    • Apple consistently increased its revenue per employee from 2019 to 2022, with the highest figure in 2022.
    • Apple had the highest revenue per employee across all companies in each year.
  • Meta (formerly Facebook):
    • Meta experienced a decrease in revenue per employee from 2019 to 2020, followed by an increase in 2021.
    • However, revenue per employee decreased again in 2022, settling between the 2020 and 2021 figures.
  • Microsoft:
    • Microsoft’s revenue per employee increased steadily from 2019 to 2022, although the increase was relatively modest compared to other companies.

Key Trends in Revenue Per Employee in Big Tech

  • Apple consistently had the highest revenue per employee among the listed companies.
  • Tesla exhibited the most significant percentage increase in revenue per employee from 2020 to 2022.
  • Amazon was the only company that experienced a decrease in revenue per employee for two consecutive years (from 2019 to 2021).
  • Microsoft displayed the most consistent and steady growth in revenue per employee over the years, although at a more modest rate compared to other companies.
  • Google and Meta had a fluctuating trend in revenue per employee, with both companies experiencing a decrease in 2022 compared to 2021.
revenue-per-employee

Read Next: Amazon Business Model

amazon.annual-revenue

Connected to Amazon Business Model

Amazon Business Model

amazon-business-model
Amazon has a diversified business model. In 2022 Amazon posted over $514 billion in revenues, while it posted a net loss of over $2.7 billion. Online stores contributed almost 43% of Amazon revenues. The remaining was generated by Third-party Seller Services, and Physical Stores. While  Amazon AWS, Subscription Services, and Advertising revenues play a significant role within Amazon as fast-growing segments.

Amazon Revenue By Country

Amazon Revenue By Country
In 2022, most of Amazon’s revenue came from the US, with over $356 billion in revenue, followed by Germany with $33.6 billion, the UK with $30 billion, Japan with $24.4 billion, and the rest of the world generated almost $70 billion in net sales.

Amazon Cost Structure

amazon-cost-structure
Both the North American and International segment of Amazon are running at negative margins. Indeed, in 2022, for the North American segments, of almost $316 billion in revenue, Amazon spent almost $319 billion in operating costs to run it, thus it generated $2 billion in operating losses in 2022. For its International segment, of $118 billion in revenue, Amazon spent almost $126 billion to operate it. Thus, it reported a $7.7 billion operating loss. While for AWS, with $80 billion in revenue, Amazon spent $57 billion to operate it, thus generating almost $23 billion in operating income. The high operating costs are primarily due to the high cost of running Amazon’s inventory and fulfillment infrastructure behind its e-commerce operations. Indeed, Amazon is as much as a physical player as a digital one.

Is Amazon Profitable Without AWS?

is-amazon-profitable-without-aw
Amazon was not profitable once AWS was removed in 2022. In fact, Amazon, without AWS generated $10.6 billion in operating losses. While Amazon, without AWS, generated $12.2. billion operating income.

Amazon Profit Breakdown

amazon-operating-profit-breakdown
Amazon is subdivided into three operating profit segments: North America, International, and AWS. Amazon AWS is the most profitable segment, with almost $23 billion in operating profit in 2022. While Both the North American and International segments run at negative operating losses, with $2 billion and $7.74 billion in operating losses, respectively, in 2022.

Amazon Revenue Breakdown

amazon.annual-revenue

Amazon Revenue Per Employee

amazon-revenue-per-employee

Amazon vs. Walmart

amazon-business-modelwalmart-business-model

eBay vs. Amazon

ebay-vs-amazon
In 2021, Amazon generated almost $470 billion in revenue, vs. eBay’s over $10.4 billion. In comparison, looking at revenues, Amazon was 45x times larger than eBay.

Amazon Mission Statement

amazon-vision-statement-mission-statement (1)
Amazon’s mission statement is to “serve consumers through online and physical stores and focus on selection, price, and convenience.” Amazon’s vision statement is โ€œto be Earthโ€™s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices.โ€ 

Customer Obsession

customer-obsession
In the Amazon Shareholders’ Letter for 2018, Jeff Bezos analyzed the Amazon business model, and it also focused on a few key lessons that Amazon as a company has learned over the years. These lessons are fundamental for any entrepreneur, of small or large organization to understand the pitfalls to avoid to run a successful company!

Amazon Revenues

amazon-revenue-model
Amazon has a business model with many moving parts. The e-commerce platform generated $220 billion in 2022, followed by third-party stores services which generated over $117 billion; Amazon AWS, which generated over $80 billion; Amazon advertising which generated almost $38 billion and Amazon Prime, which generated over $35 billion, and physical stores which generated almost $19 billion.

Amazon Cash Conversion

cash-conversion-cycle-amazon

Working Backwards

working-backwards
The Amazon Working Backwards Method is a product development methodology that advocates building a product based on customer needs. The Amazon Working Backwards Method gained traction after notable Amazon employee Ian McAllister shared the companyโ€™s product development approach on Quora. McAllister noted that the method seeks โ€œto work backwards from the customer, rather than starting with an idea for a product and trying to bolt customers onto it.โ€

Amazon Flywheel

amazon-flywheel
The Amazon Flywheel or Amazon Virtuous Cycle is a strategy that leverages on customer experience to drive traffic to the platform and third-party sellers. That improves the selections of goods, and Amazon further improves its cost structure so it can decrease prices which spins the flywheel.

Jeff Bezos Day One

jeff-bezos-day-1
In the letter to shareholders in 2016, Jeff Bezos addressed a topic he had been thinking quite profoundly in the last decades as he led Amazon: Day 1. As Jeff Bezos put it “Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1.”

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