“This market is just nuts,” said Sucharita Mulpuru, an analyst with Forrester Research. “Amazon’s profit is effectively 0 percent of revenue and everyone cheers. Apple grows faster and has a profit that is 20 percent of revenue, and the stock tanks. Amazon’s stock price doesn’t seem to be correlated to its actual experience in any way.”Efficient-market theorists, you need to explain Amazon -- all twenty-plus years of it -- before the rest of us will ever listen to you again.
Also, given that Amazon's profit is effectively 0 percent of revenue, and is driven by the higher-margin Amazon Web Services business, it is very likely that the "core" selling-stuff-to-people-over-the-Internet business is still losing money every quarter except Christmas. I know retail is a tough business, but let's get real: the investor class has subsidized the destruction of countless media businesses and their real-world retail channels in pursuit of shiny nothingness for two decades now.