's Biggest Profits Don't Come From E-commerce

By Motley Fool

Amazon Web Services isn't one of the company's most popular segments, but it provides a massive chunk of Amazon's (NASDAQ: AMZN) operating profits.

In this segment fromIndustry Focus: Tech,Motley Fool analyst Dylan Lewis and Fool contributor Daniel Sparks go over the numbers, and why investors should start keeping an eye on this segment if they aren't already.

Continue Reading Below

A full transcript follows the video.

Forget the 2016 Election: 10 stocks we like better than Donald Trump was just elected president, and volatility is up. But here's why you should ignore the election:

More From

Investing geniuses Tom and David Gardner have spent a long time beating the market no matter who's in the White House. In fact, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now and wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of November 7, 2016

This podcast was recorded on Nov. 4, 2016.

Daniel Sparks: As far as Amazon Web Services, that was another interesting area during the call. Of course, it always is. I think investors think of Amazon as this e-commerce company. At the end of the day, a huge chunk of theiroperating profits comes from Amazon Web Services,even though it's only about 10% of revenue. This was an area that investors should always make sure and turn to, even though they might not have experience with Amazon Web Services. The fact is, Amazon Web Services is a big deal. We can call it AWS for short.

Dylan Lewis:Yeah. That is really a cash cow for the business.I love the statistic. The division's $861 million operating profit was more than 3 times larger than the North America retailing profits, which is bananas, and gives you an idea of how crucial it is to the business, despiteonly being 10% of the top line. Certainly something to be mindful of. That segment inparticular had 55% year-over-year sales growth, and 101% higher operating profits. Those are two things that are trending very nicely for them.

the_motley_fool has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.