Will Amazon Be a $5 Trillion Stock by 2030?

Core Viewpoint - Amazon's stock has shown strong performance, currently valued at $2.37 trillion, with potential to reach a $5 trillion market capitalization by the end of 2030, representing a 111% gain from current levels [1][2]. Group 1: Business Segments - Amazon's online stores and third-party seller services grew revenue by 5% and 6% respectively in Q1, indicating mature segments with slower growth [5]. - The most promising segments for growth are Amazon Web Services (AWS) and advertising, which are expected to drive future valuation increases [5][10]. - AWS revenue increased by 17% year over year in Q1, with operating income rising 23%, showcasing its superior operating margins of 39% compared to the commerce business [7]. - Advertising services emerged as the fastest-growing segment in Q1, with an 18% year-over-year revenue increase, and is expected to maintain rapid growth due to valuable advertising data [8][10]. Group 2: Financial Projections - To achieve a $5 trillion valuation, Amazon would need to produce $200 billion in operating income by the end of 2030, requiring significant growth from its current $72 billion [11]. - If AWS and advertising can each achieve a compounded annual growth rate of 15% over the next five and a half years, projected revenues would be $241 billion and $126 billion respectively, generating $147 billion in operating income from these segments alone [12]. - The remaining business segments would need to generate an additional $53 billion in operating income, which is considered feasible [12].