Amazon, Inc. AMZN has come a long way from its humble beginnings and has evolved as a technology company with diverse interests such as e-commerce, cloud computing, online advertising, digital streaming and artificial intelligence.
It is now part of an informal group of the five biggest tech corporations dubbed as FAANGs.
Not everybody bet on the company's success when it started out.
Surviving Early Skepticism: Founded by Jeff Bezos out of his garage in Bellevue, Washington in July 1994, Amazon initially served as an online marketplace for books. It gradually expanded the product categories it hawks online and emerged as an e-commerce behemoth.
The company went public in May 1997 by offering shares at $18 apiece and raised $54 million through the sale.
On May 31, 1999, Barron's published a story titled "Amazon.bomb" in which the media outlet argued that the company's stock was overvalued and would come crashing down.
Investing in an unprofitable company makes no sense, Barron's report said. It also opined that brick-and-mortar retailers such as Walmart, Inc. WMT and Barnes & Noble Education, Inc. BNED will eventually start selling online and send Amazon out of business.
Amazon’s first overseas expansion was into the U.K. in Dec. 1998 and it now has a sprawling international operation.
Notably, in October 2021, Bezos posted this cover story from Barron’s, saying, “Listen and be open, but don't let anybody tell you who you are. This was just one of the many stories telling us all the ways we were going to fail.”
See Also: Everything You Need To Know About Amazon Stock
Standing The Test Of Time: Adding to its credentials as the "Everything Store," Bezos launched Amazon Prime, a subscription-based service, in 2005. It offered subscribers free shipping and streaming media access. Expanding into cloud computing, Amazon Web Services (AWS) debuted in 2006. The Kindle e-reader disrupted publishing in 2007, popularizing digital books. Amazon’s hardware line includes the innovative Amazon Echo with Alexa. The company acquired Whole Foods Market in 2017, entering physical grocery retail.
For the fiscal year ended 2022, Amazon reported net sales of $514 billion, up 9% year-over-year. However, a net loss of $0.27 per share was attributed to a $12.7 billion pre-tax valuation loss from its investment in Rivian Automotive, Inc. RIVN investment. Ranked third globally in revenue, Amazon follows Walmart and Saudi Aramco.
Returns From Amazon: A $1,000 investment in Amazon when Barron predicted doom for the company would have fetched 377.4 shares. The same shares, if held without liquidation, would have appreciated in value to $46,577.4 (based on the $123.43 at which the stock closed on Friday).
This would mean a net gain of 4,558% on the initial investment. This compares to S&P 500's 233% gain and the Nasdaq Composite's 450% jump.
In premarket trading, Amazon shares rose 0.51% at $124.06, according to Benzinga Pro data.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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