The retail industry will never be the same again because Amazon.com (NASDAQ: AMZN)’s TTM revenue is fast approaching $100 billion.
The Everything Store’s TTM revenues hit $88.99 billion on Dec. 31, 2014. That makes Amazon.com one of the largest retailers in the United States as well as in the world. It also means that there are only four U.S. retailers with TTM revenues larger than Amazon: Walmart Stores Inc. (NYSE: WMT), which reported a TTM revenue figure of $483.79 billion on Oct. 31, 2014; Costco Wholesale (NASDAQ: COST), which reported a TTM revenue of $114.49 billion on Nov. 30, 2014; Kroger (NYSE: KR), which reported a TTM revenue of $106.48 billion on Oct. 31, 2014; and CVS Health (NYSE: CVS), which reported a TTM revenue of 139.37 billion on Dec. 31, 2014.
That makes Amazon one of the five largest retailers in America, larger than Target (NYSE: TGT), which reported a TTM revenue of $73.7 billion on Oct. 31, 2014; Walgreens Boots Alliance (NASDAQ: WBA), which reported a TTM revenue of $77.62 billion on Nov. 30, 2014; and Home Depot (NYSE: HD), which reported a TTM revenue of $81.71 billion on Oct. 31, 2014.
Amazon’s Revenue Growth Exceeds Many Competitors’ Revenues
For the record, the top 10 U.S. retailers in the U.S. in 2013 were Wal-Mart, Kroger, Costco, Target, The Home Depot, Walgreen, CVS Caremark, Lowe’s (NYSE: Lowe’s), Amazon and Safeway. Amazon’s Revenues now exceed those of all but three of those retailers. That’s extraordinary because Amazon joined that list just last year, according to the Stores/Kantar Retailers report. For the record, Lowe’s reported a TTM Revenue of $55.34 billion on Oct. 31, 2014, and Safeway’s revenue cannot be reported because it is in the middle of a merger with Albertson’s.
Even though Amazon gets a lot of its revenue from non-retail sources such as data centers, it also gives Jeff Bezos an incredible amount of leverage in the retail business. It gives Amazon the kind of power that only Kroger or Wal-Mart used to have: the ability to dictate prices to suppliers. Even giant companies like Proctor & Gamble (NYSE: P&G) are going to have to learn to play ball with Mr. Bezos, whether they like it or not.
What’s truly staggering is the rate at which Amazon.com’s TTM revenue is growing. In December 2012 Amazon reported a TTM revenue of $61.09 billion; in December 2013 it reported a TTM revenue of $74.45 billion; and by Dec. 31, 2014, that figure had reached $88.99 billion. Amazon’s TTM revenues have grown by $27.90 billion in just two years—$14.54 billion in one year.
The amount of revenue growth at Amazon.com in the last two years is approaching the total TTM revenue figure for , which owns both and Kmart: $33.69 billion. It almost equals total TTM revenues: $27.94 billion on Oct. 31, 2014. The amount of TTM revenue growth at Amazon in one year is approaching total revenue, which was $18.79 billion. It exceeds revenue, which was $12.15 billion on Oct. 31, 2014.
The amount of revenue growth at Amazon.com in the last two years is approaching the total TTM revenue figure for Sears Holdings (NYSE: SHLD), which owns both Sears and Kmart: $33.69 billion. It almost equals Macy’s (NYSE: M) total TTM revenues: $27.94 billion on Oct. 31, 2014. The amount of TTM revenue growth at Amazon in one year is approaching Kohl’s (NYSE: KSS) total revenue, which was $18.79 billion. It exceeds JC Penney’s (NYSE: JCP) TTM revenue, which was $12.15 billion on Oct. 31, 2014.
TechCrunch reported that Amazon had $29.33 billion revenue in the fourth quarter of 2014. That means Amazon’s revenue in one quarter exceeded Macy’s revenue for the entire year.
The amount of Amazon’s retail growth now exceeds the total revenue of a number of historic retailers. What’s more incredible is that if it keeps going, that revenue will exceed $100 billion sometime in 2015. It’s likely that will happen because Amazon’s sales grew by 27.2% between 2012 and 2013. Amazon reported a year to year quarterly TTM growth rate of 14.62% on Dec. 31, 2014. Wal-Mart reported a rate of 2.86%.
It looks as if the online retail revenue that we’ve been expecting for nearly 20 years has arrived. Amazon has succeeded in totally disrupting retail and changing the business beyond recognition. Historic retailers are having a hard time maintaining sales even as Amazon grows by several billion dollars each month.
We are going to have to write a completely new set of guidelines for retail. Even though Amazon.com may not be profitable, it is gigantic, and with that size, its ability to disrupt retail and many other industries grows and grows.
One has to wonder when the folks in Washington, DC, will notice this and Amazon will become the target of antitrust regulators. We also have to wonder how many more historic retailers will follow in RadioShack’s footsteps and fall before Amazon. Retail has changed beyond recognition.
We’re entering a completely new world of retail, one in which the old rules no longer apply. More importantly, Amazon.com could be on the verge of becoming America’s dominant retailer. If that happens, it will be a whole new retail ball game, and investors will have to understand a new paradigm.
Even if it doesn’t become the dominant retailer, Amazon.com is now a giant—a giant that will change retail forever and impact every facet of our lives. If Amazon’s growth continues, the retail apocalypse will become the dominant story in many American communities.
Disclosure: The author conducts retail sales through Amazon.com and owns shares of Kroger.