If I spend $100 on Amazon, How Much Goes into Jeff Bezos' Pocket?

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It is highly variable. If the $100 item you buy gives amazon a mere $5 profit margin, considering Jeff's 11% ownership of the company (amount of stock he has), you are talking at a MAXIMUM of $0.55. Most tech products have a pretty low profit margin, for example. I'm sure stuff from the big guys, like Samsung et. Al, give them very little profit, if any profit for that matter. The $599 Google Pixel 6 phone also costs $599 on Google's website. Why would Google sell Amazon the phone for under $599 for them to sell at $599, when they would prefer you buy it direct from them? Google is either providing them at cost and Amazon makes $0 profit, or they have some contractual financial agreement to list on Amazon. Amazon's (among other stores) business model has always been to get you hooked on their site and get you buying in volume, and also paying for various digital services, like Amazon Prime.

A great example is CostCo. Their profit margins on all the stuff they sell is extremely low. All the money they make is from their membership fee business model. Check out this old 2019 thread about their revenues: https://twitter.com/investing_city/status/1179974257779982336. Part 9: "Membership fees only make up about 2% of sales but normally a little bit more than 100% of profit."

It is exactly what Amazon is doing with their prime model. Price authority. Sell at cost or even at a loss, goad people into paying $120 (now $140) per year for the right to get your shit fast.

Now, of course Amazon is not CostCo just selling physical goods. They have a digital services division (prime video, kindle, etc.), they have a web services division (AWS is pretty much the top dog for cloud services, among other things), there's the twitch division. But you are more interested in how your purchase at Amazon goes into Bezos' pocket. So you really only care what percentage of the profit makes up the profit from sales. It is very possible (I dont feel like doing the research to figure it out) that next to nothing goes in his pocket from your mere $100 sale. More than likely the profit margin is low, and that tiny bit of profit is part of a HUGE VOLUME of profit from sales in the billions.

It is highly variable. If the $100 item you buy gives amazon a mere $5 profit margin, considering Jeff's 11% ownership of the company (amount of stock he has), you are talking at a MAXIMUM of $0.55. Most tech products have a pretty low profit margin, for example. I'm sure stuff from the big guys, like Samsung et. Al, give them very little profit, if any profit for that matter. The $599 Google Pixel 6 phone also costs $599 on Google's website. Why would Google sell Amazon the phone for under $599 for them to sell at $599, when they would prefer you buy it direct from them? Google is either providing them at cost and Amazon makes $0 profit, or they have some contractual financial agreement to list on Amazon. Amazon's (among other stores) business model has always been to get you hooked on their site and get you buying in volume, and also paying for various digital services, like Amazon Prime. A great example is CostCo. Their profit margins on all the stuff they sell is extremely low. All the money they make is from their membership fee business model. Check out this old 2019 thread about their revenues: https://twitter.com/investing_city/status/1179974257779982336. Part 9: "Membership fees only make up about 2% of sales but normally a little bit more than 100% of profit." It is exactly what Amazon is doing with their prime model. Price authority. Sell at cost or even at a loss, goad people into paying $120 (now $140) per year for the right to get your shit fast. Now, of course Amazon is not CostCo just selling physical goods. They have a digital services division (prime video, kindle, etc.), they have a web services division (AWS is pretty much the top dog for cloud services, among other things), there's the twitch division. But you are more interested in how your purchase at Amazon goes into Bezos' pocket. So you really only care what percentage of the profit makes up the profit from sales. It is very possible (I dont feel like doing the research to figure it out) that next to nothing goes in his pocket from your mere $100 sale. More than likely the profit margin is low, and that tiny bit of profit is part of a HUGE VOLUME of profit from sales in the billions.

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