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Amazon’s Growth Projections and Profit Drivers
Amazon (NASDAQ: AMZN) is currently valued at $2.5 trillion and aims to double that to $5 trillion by 2030. The company primarily profits from its Amazon Web Services (AWS) and advertising services, which are both growing rapidly. Amazon’s operating profits are projected to increase by 20% to 30% annually, leading to estimated operating profits of $210 billion by 2030.
The global cloud computing market is forecasted to grow from $752 billion in 2024 to $2.39 trillion in 2030, with a compound annual growth rate (CAGR) of 20%. Meanwhile, Amazon’s advertising services are growing at an impressive rate of 23% and are considered one of the best ad spaces online.
For Amazon to reach its $5 trillion valuation, it needs sustained growth in its AWS and advertising divisions. If operating profit multiples decrease from 32 times to 25 times, it would lead to a straightforward increase in the company’s market cap, positioning Amazon as a strong long-term investment.
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