Amazon (AMZN) margins have hit a new all-time high as of Q4 2024 according to a report, with the latest twelve months’ gross profit margin growing to 48.9%. In its fourth quarter 2024 investor letter, Diamond Hill Large Cap Concentrated Fund emphasized AMZN’s latest performances, highlighting the improvement in its Margins. “Amazon Web Services’ (AWS) revenue growth accelerated in the quarter, and, despite increased AI-related capital expenditures, margins improved to all-time highs.”
Through various major market indicators, Amazon’s financial trajectory has catalyzed significant investor attention. The e-commerce giant’s stock has fallen about 11% this year and currently trades around 20% below its 52-week high of $242. Despite this, the company is still posting quality numbers, and analysts are bullish on the company’s performance throughout the remainder of this year.
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In terms of what’s next for the company, Amazon (AMZN) is set to invest $100 billion in Amazon Web Services (AWS) in 2025. The investment is an exciting proposition to some, and a concerning one to others. It ensures the popularity and usage rate that AWS enjoys. Moreover, it may position the business atop a thriving cloud computing sector. On the other hand, in recent years, a good predictor of Amazon’s stock success has been operating income. In early February, it reported operating income of $68.6 billion, a record. In response, the stock reached a record price of $233 that same month. Thus, this investment could take away from the company’s operating net income.
That certainly isn’t the whole story, as things still look increasingly bright in the long term for Amazon. It is among the most well-diversified tech stocks on the market. Moreover, down more than 20% this year already, the worst may already be behind investors. Altogether, things look to be bright in the future, even if there are some bumps in the road this year.