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.
Apple has a business model that is broken down between products and services. Apple generated over $365 billion in revenues in 2021, of which $191.9 came from the iPhone sales, $35.2 came from Mac sales, $38.3 came from accessories and wearables (AirPods, Apple TV, Apple Watch, Beats products, HomePod, iPod touch, and accessories), $31.86 billion came from iPad sales, and $68.4 billion came from services.
Google (now Alphabet) primarily makes money through advertising. The Google search engine, while free, is monetized with paid advertising. In 2021 Google’s advertising generated over $209 billion (beyond Google Search, this comprises YouTube Ads and the Network Members Sites) compared to $257 billion in net sales. Advertising represented over 81% of net sales, followed by Google Cloud ($19 billion) and Google’s other revenue streams (Google Play, Pixel phones, and YouTube Premium).
Facebook, the main product of Meta is an attention merchant. As such, its algorithms condense the attention of over 2.91 billion monthly active users as of June 2021. Meta generated $117.9 billion in revenues, in 2021, of which $114.9 billion from advertising (97.4% of the total revenues) and over $2.2 billion from Reality Labs (the augmented and virtual reality products arm).
Microsoft has a diversified businessmodel, spanning from Office to gaming (with Xbox), LinkedIn, search (with Bing), and enterprise services (with GitHub). In 2021, Microsoft made over $198 billion in revenues, of which over $67 billion came from Server products and cloud services, and $44.8 billion came from Office products and cloud services. Windows generated $24.7 billion, Gaming generated over $16 billion, LinkedIn over $13 billion, and search advertising (through Bing) over $11.5 billion. Enterprise (GitHub) generated $7.4 billion, and devices (PC) generated almost $7 billion.
Netflix is a subscription-based business model making money with three simple plans: basic, standard, and premium, giving access to stream series, movies, and shows. Leveraging on a streaming platform, Netflix generated over $29.6 billion in 2021, with an operating income of over $6 billion and a net income of over $5 billion.
NVIDIA is a GPU design company, which develops and sells enterprise chips for industries spacing from gaming, data centers, professional visualizations, and autonomous driving. NVIDIA serves major large corporations as enterprise customers, and it uses a platform strategy where it combines its hardware with software tools to enhance its GPUs’ capabilities.
Tesla is vertically integrated. Therefore, the company runs and operates the Tesla’s plants where cars are manufactured and the Gigafactory which produces the battery packs and stationary storage systems for its electric vehicles, which are sold via direct channels like the Tesla online store and the Tesla physical stores.
Key highlights
Amazon: A diversified business model with online stores, Third-party Seller Services, Physical Stores, AWS, Subscription Services, and Advertising contributing to revenues.
Apple: Revenue generated from products like iPhone, Mac, iPad, accessories, and wearables, along with services like Apple Music, iCloud, and App Store.
Google (Alphabet): Mainly monetized through advertising, with Google Search, YouTube Ads, and Network Member Sites being significant sources of revenue. Google Cloud and other revenue streams also contribute.
Meta (formerly Facebook): The main product is Facebook, generating revenue primarily from advertising. Reality Labs (augmented and virtual reality products) also contributes.
Microsoft: A diversified model with revenues from Server products and cloud services, Office products and cloud services, Windows, Gaming (Xbox), LinkedIn, Bing, GitHub, and PC devices.
Netflix: A subscription-based model with three plans (basic, standard, and premium) for streaming series, movies, and shows, generating substantial revenue.
NVIDIA: Specializes in GPU design and sells enterprise chips for gaming, data centers, professional visualizations, and autonomous driving. It employs a platform strategy combining hardware with software tools.
Tesla: Vertically integrated, operating Tesla’s manufacturing plants and Gigafactories for electric vehicles and battery packs. Sells vehicles via direct channels like the online store and physical stores.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
