Amazon Passes Wal-Mart as Highest Valued Retailer

This week Amazon’s market cap jumped nearly $40 billion to $264B, surpassing Wal-Mart’s $233.5B.  The e-commerce giant surprised many analysts by posting a net income of 92 million in the three months ended June 30, a startling jump compared with their net loss of $126 million in the same period a year ago. Though Wal-Mart still generates more sales than Amazon ($485.B in the last 12 months compared to $95.8B), the e-commerce giant passing Wal-Mart in terms of value in the eyes of investors represents a major milestone for Amazon.

Until fairly recently, the majority of the horse race between Amazon and Walmart has been a battle of complete opposites, with both chains dominating their historic areas of expertise.

Launched in 1995, Amazon began as an online bookstore before diversifying its product lines by adding virtually anything you would ever consider buying. Amazon’s online sales are more than the combined sales of the next 10 biggest online sellers, which include Wal-Mart and Apple. Considering the success of the Amazon Prime’s $99/year subscription that includes free two-day shipping and access to an extensive music, television and movie library and initiatives such as Amazon’s Fresh same-day delivery of groceries, its not hard to see why they are biggest .

Though Walmart relies heavily on their brick-and-mortar stores to drive revenue, Walmart has demonstrated that it is a company that knows how to leverage technology, evidenced by its state-of-the-art inventory and distribution system that is vital to its low-price positioning. Wal-Mart’s technological prowess was key to the way the company’s transportation and logistics systems were pressed into action after Hurricane Katrina.

You can bet that these two retail giants are not resting on their laurels and that may be the biggest takeaway from all of this:  Even if you aren’t Amazon or Wal-Mart, evolving and innovating is necessary to stay ahead of the competition.

Leading-edge businesses are partnering with Talley & Company and its affiliates to take advantage of our wide range of services, such as bookkeeping, financial reporting, technology advising, tax planning, and estate planning. Talley & Company can help you design and execute fully customizable solutions to fit the unique needs of your business.