Jeff Bezos’ Amazon.com Inc. (NASDAQ:AMZN) once nearly ran out of cash 24 years ago, through the dot-com bubble crisis of 2000. It was once reportedly left with just 10 months of cash, with its stock price plunging to $7 from $107.
Fast forward to 2024, Amazon is anticipated to have nearly as much money on its balance sheet as rivals Apple Inc. (NASDAQ:AAPL) and Microsoft Corp. (NASDAQ:MSFT) combined by 2027.
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What Happened: Amazon is projected to amass $127.4 billion in money and short-term investments by the tip of the 12 months, based on S&P Global Market Intelligence, reported Business Insider.
This figure surpasses the cash reserves of tech giants Alphabet Inc. and Microsoft, which stand at $112.8 billion and $108.1 billion, respectively.
By 2027, Amazon’s money reserves are expected to approach $400 billion, a giant shift for an organization traditionally focused on reinvestment fairly than money accumulation.
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Wall Street is now speculating whether Amazon will follow throughout the footsteps of other tech corporations by returning a couple of of this money to shareholders through buybacks or dividends.
Apple is projected to have a money pile of $106.51 billion, while Microsoft is anticipated to amass $300.88 billion, putting the combined total at $407.39 billion for two of the world’s most precious corporations by market capitalization.
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For context, through the dot-com bubble crash in 2000, Amazon’s stock plummeted and the company’s money reserves were falling, too. Bezos, though, was unfazed. “Well, we’re a famously unprofitable company,” he said.
“And which may be a conscious strategy and an investment decision.”
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Why It Matters: Amazon’s increasing money reserves come at a time when the company is making strategic moves to bolster its market position.
Recently, Cathie Wood’s Ark Invest made a giant investment in Amazon, purchasing 76,505 shares despite concerns in regards to the company’s growth trajectory. This move followed a Wells Fargo downgrade, citing slowing growth and increased competition.
Furthermore, Amazon is preparing for the holiday season by boosting its workforce by 250,000 to satisfy the demands of the retail surge. This hiring spree highlights Amazon’s commitment to maintaining its competitive edge throughout the retail sector.
As Amazon’s money reserves grow, the company faces pressure to balance reinvestment strategies with potential shareholder returns, a call which may significantly impact its future financial trajectory.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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This text Jeff Bezos-Led Amazon Almost Ran Out Of Money 24 Years Ago. At $400B, It Is Now Projected To Have As Much Money As Apple And Microsoft Combined By 2027: Here’s More originally appeared on Benzinga.com