Amazon becomes second US company to reach USD 1 trillion value </s> Amazon becomes second publicly traded US company to reach $1 trillion in market value. </s> Amazon is 2nd US company to reach $1 trillion market value </s> For a short while Tuesday, Amazon joined Apple and hit a $1 trillion valuation.

The e-commerce giant's stock rose to a high of $2,050.50 on Tuesday morning. It needed to reach $2,050.27 to cross the trillion-dollar threshold, based on the count of 487,741,189 shares from Amazon's most recent quarterly report in July.

Amazon is the second US company to hit that mark, driven by its continued dominance in the retail world and its highly profitable cloud services business.

Amazon didn't stick around that level for long. The company recently traded at $2,024.64, up 0.6 percent from the previous trading session but below the $1 trillion mark, according to Yahoo Finance.

Apple became a trillion-dollar company in early August, hitting $207.05 a share. It was the first US company to make that mark, and the second public company reached a trillion in the world. PetroChina, an oil and gas company, hit $1 trillion for a short time on the Shanghai Stock Exchange in 2007. On Tuesday, Apple's market cap hovered around $1.1 trillion. </s> (CNN Money) — America’s is about to become the second $1 trillion company.

Amazon’s total value neared $1 trillion on Tuesday, following Apple’s ascent into 13-digit territory at the beginning of August. Amazon and Apple now make up more than 8% of the entire value of the S&P 500, according to Howard Silverblatt, senior index analyst for S&P.

Shares of Amazon were just $10 away from the $2,050.27 they needed to reach the $1 trillion valuation.

A trillion dollars may be an arbitrary threshold, but it’s still a remarkable statement of how quickly the 24-year-old company has grown, and the boundless confidence investors have in its future.

Just contrast Amazon with the brick and mortar sector, where 90% of American retail spending still takes place. In order to get to a $1 trillion market cap, you’d have to add up the valuations of the 14 largest big box retailers ranked by 2017 revenues, from Walmart to Autonation.

Investors are also way more excited about Amazon than other grocery, building supply, and general retail stocks, which have an average price-to-earnings ratio of between about 20 and 40 for the previous year, according to New York University finance professor and valuation expert Aswath Damodaran. Amazon’s price-to-earnings ratio is about 180.

So how did we get here?

For years, investors buoyed Amazon’s stock without seeing the company generate significant profits, as it poured revenues back into the business: Building out its fulfillment center network, buying up companies, and developing new technologies.

But over the past year, Amazon has started turning up the dial on profits.

At the beginning of 2018, the company was worth just $580 billion. In the second quarter, the company’s net income ballooned to $2.5 billion, compared to $197 million in second quarter of 2017.

Driving those margins: The success of Amazon Web Services, the company’s cloud business, as well as the advertising it sells across its sites and revenues from Prime membership subscriptions.

Watching Amazon flex its profit muscles has boosted analysts’ enthusiasm for the stock even further.

Morgan Stanley recently raised its price target to $2,500, which would make Amazon worth $1.2 trillion, based on revenue growth projections of 24% per year through 2020. It values Amazon Web Services, now an ubiquitous layer of the internet that supports enterprises ranging from the smallest startup to the Central Intelligence Agency, at $375 billion.

The company’s moves over the past year have even won over former skeptics who previously believed Amazon’s stock was overhyped.

Daniel Martins, who heads his own independent research firm, thought Amazon was too expensive in early 2017 because optimistic growth expectations seemed already baked in to the price. But after evaluating its most recent financial results, including aggressive expansion into new industries and other countries, he now predicts Amazon could double in value by 2020.

“It’s too high of a bar to assume that they’ll succeed at everything that they do,” Martins says. “But at the same time, I think Amazon is the best combination in the world of the scale of a large company and that entrepreneurial DNA with the spirit of a startup.”

Amazon is appealing to investors because it appears able to dominate any industry it enters through the power of the data it has on Prime members and its ability to get stuff from point A to point B extremely quickly. Groceries! Healthcare! Financial services! Media! Even your home cleaning service!

But if that vision became reality, wouldn’t it put Amazon on a collision course with antitrust regulators? Are investors pricing in the risk that a store that sells everything might get broken up?

Under current interpretations of federal laws, they probably have little to worry about.

Antitrust regulators typically look at whether a company has used its dominance in a given market to raise prices on consumers. So far, Amazon has only lowered prices — no competitive harm.

But scholars have raised concerns that over time, Amazon’s control of consumer pocketbooks could prevent the next trillion dollar company from ever gaining traction.

“if it means a long-term innovation loss, the tradeoffs might be ones that we don’t want to live with,” says Hal Singer, a senior fellow at George Washington University’s Regulatory Studies Center and a principal at Economists, Inc.

He has proposed creating a special tribunal for complaints that online platforms are unfairly discriminating against content providers or potential challengers, which Senator Mark Warner referenced in a policy framework for internet companies.

At the moment, though, no such protection exists.

“If antitrust stays the same, then there really is no risk,” Singer says. “I think Amazon shareholders should sleep very well at night.”

© Copyright 2018 CNN. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. </s> Amazon has become the second U.S. public company to cross the $1 trillion valuation threshold this year, one month after Apple did so.

Amazon shares hit $2,050.49 shortly before noon on Tuesday, bringing the company’s value above $1 trillion. Apple became the first $1 trillion company last month. It is currently worth about $1.1 trillion.

For years, Amazon CEO Jeff Bezos was pilloried by Wall Street and the media for the e-commerce giant’s habit of spending too much and earning too little. But that strategy has paid off in spades, with the company quickly gaining on Apple as the most valuable publicly traded company in the world. Amazon had $178 billion in revenues last year.

Other big companies — including industrial giants that have been around for more than a century, such as Boeing (market cap $207 billion), 3M ($119 billion) and General Motors ($55 billion) — are worth far less than the high-flying tech companies because their prospects for earnings growth are nowhere near as strong. Market watchers have been expecting both Amazon and Apple to eventually have valuations topping $1 trillion.

Amazon shareholders have already had a extraordinarily good year. The company’s stock has surged more than 70 percent since January, outperforming Apple, which has gained more than 30 percent. During that same period, the broad market benchmark S&P 500 rose 8 percent. </s> Amazon’s value has surged past one trillion dollars, making it only the second public company to hit the milestone in history.

The US internet retail giant’s shares rose by around 2pc on Tuesday, sending it past the $1 trillion (£780bn) mark for the first time.

It comes just a month after Apple became the first publicly-traded trillion-dollar company in history. Its value has increased further since, and it is currently worth around $100bn more than Amazon.

Amazon’s seismic increase in value in recent years has made its founder Jeff Bezos the world’s richest person. Mr Bezos’s net wealth currently stands at $166bn, according to Bloomberg, making him worth $68bn more than Microsoft co-founder... </s> Amazon on 4 September became the second US public company after Apple to hit the $1 trillion valuation mark.

Last month, Apple became the first US company to become a $1 trillion company.

According to a report in CBS News, Amazon shares hit $2,050.49 — climbing 1.5 per cent in the morning trade — bringing the company's market value above $1 trillion.

Amazon Founder Jeff Bezos is already the richest person on Earth, with a net worth surpassing $150 billion.

He owns over 16 per cent of Amazon which he founded in a garage in Seattle in 1994.

Apple became the first $1 trillion company last month. The Cupertino-based iPhone-maker is currently worth about $1.1 trillion.

Google's parent company Alphabet Inc and Microsoft are fast approaching the $900 billion mark, reports said.

Facebook — which crossed $500 billion in 2017 — is not growing much owing to a massive data privacy scandal amid falling user base. </s> Image copyright Getty Images

Amazon has briefly become the second US-listed firm to have a market value of more than $1 trillion (£779bn).

Shares in the e-commerce giant rose nearly 2% to a high of $2,050.50 in morning trade before slipping back.

Apple reached the same milestone in early August.

Founded in 1994, Amazon is now the world's largest online retailer. Its chief executive, Jeff Bezos, is the world's richest man, with a net worth of more than $160bn.

Neil Saunders, managing director of GlobalData Retail, said: "To reach a market capitalisation of over $1tn is impressive. To do it in a little over 24 years is extraordinary.

"That Amazon has achieved this demonstrates its dramatic advancement in both the retail and technology sectors, as well as the influence it now wields over large parts of the consumer landscape."

Analysis: Kim Gittleson, New York business correspondent

Like a pesky younger sibling, Amazon might be second to the symbolic trillion-dollar milestone - but when it comes to its rivalry with Apple, it's been quicker to hit nearly every hundred-billion dollar valuation hurdle.

For instance, it took Amazon just 16 days, compared to Apple's 622 days, to go from a market value of $600bn to $700bn, according to the Wall Street Journal.

This acceleration makes sense in a way, because Amazon spent most of its time as a public company reporting losses or negligible profits. Founder Jeff Bezos consistently said he would rather reinvest sales revenue into the company to give it a better, more profitable future.

It's a strategy that seems to have paid off: Amazon reported $2.5bn in profit last quarter, making it one of Wall Street's most profitable companies.

And the future seems bright.

Even more so than Apple, Amazon is in the business of how we'll live in the future.

Although nearly half of every dollar spent online by an American goes to Amazon, e-commerce still makes up just 9% of total retail sales here. And Amazon has also become the market leader in cloud computing, with its Web Services business line consistently beating expectations.

All of this suggests that when it comes to Amazon's growing market value, the best word to describe it might in fact be the name Mr Bezos reportedly initially had planned for the company: relentless.

Amazon reported nearly $53bn in sales in the three months ended in June, with record quarterly profit of $2.5bn.

The firm is expected to account for roughly half of all online shopping sales in the US this year - and nearly 5% of the country's overall retail market, according to research firm eMarketer.

It employs more than 575,000 people, a force nearly the size of Luxembourg's population.

It provides logistics, storage, loans and a selling platform to hundreds of thousands of third-party merchants.

Its profitable cloud computing division, which hosts huge swathes of the corporate world on its data servers, is the industry's global leader. </s> REUTERS: Amazon.com Inc said on Thursday it would build a US$5 billion second headquarters in North America, kicking off a competition between cities and states to offer tax cuts and incentives that could bring 50,000 new jobs.

The largest e-commerce company said it intended to create "HQ2", a headquarters that would be a "full equal" to its Seattle office, Chief Executive Jeff Bezos said in a statement. The company wants a city of more than a million people with an international airport, good education and mass transit.

It also wants subsidies. Incentives from land to fee cuts to relocation packages will be a major part of the decision, Amazon said, and local governments have shown they will go to great lengths to secure jobs and investment. In return, it promised up to 50,000 jobs averaging more than US$100,000 in annual compensation over the next 10 to 15 years.

Wisconsin's legislature recently voted to give Taiwanese manufacturer Foxconn a US$3-billion incentive package to build a US$10-billion liquid crystal display factory in the state, for example.

Cities and states immediately began expressing interest. Dallas has already contacted Amazon, Mayor Michael Rawlings said, and Kentucky plans to submit a formal bid. Houston is interested and Chicago Mayor Rahm Emanuel has made a case for his city in discussions with Bezos, a Chicago spokesman said. Toronto's mayor John Tory called the Canadian city a "prime candidate."

Amazon's investment plan gives it new leverage with politicians at a time when it has been criticized for its effect on bricks-and-mortar retailers. President Donald Trump has criticized the company as doing "great damage", costing jobs in cities and states. The Wisconsin Foxconn factory will be in the home district of Paul Ryan, Speaker of the U.S. House of Representatives.

Amazon said it was seeking proposals by Oct. 19 and would select the location next year.

More than 50 cities have the 1-million population Amazon targets. Likely contenders could include U.S. Midwest states, where Amazon has many of its warehouses; Texas, which is the base of the Whole Foods Market grocery chain it acquired this year; and other business-friendly states.

Amazon has been awarded more than US$1 billion in state and local subsidies since 2000, according to estimates by watchdog Good Jobs First, which collects information on state subsidies from government filings, academics and news reports. Texas leads the way with the value of subsidies to Amazon, followed by Illinois, Kentucky, and Ohio, it said.

"Amazon's business model changed from avoiding state sales tax collections to seeking economic development incentives," said Greg LeRoy, executive director of Good Jobs First.

LeRoy, who has written critically of Amazon, said the reality of moving a headquarters has more to do with the executive talent pool, the amenities, schools, housing stock and quality of life, rather than municipal finance incentives.

Amazon's shares were up 1.2 percent at US$979.61 on Thursday.

Amazon pointed to its expansion in Seattle as a sign of what it could do. The company, which began as a bookseller, has grown into the internet's biggest retailer, built an award-winning movie studio, and has expanded around the world. Its workforce has exploded to more than 380,000 from under 25,000 since it moved to downtown Seattle in 2010, as it rapidly expanded to become a global retailer - selling everything from groceries to appliances.

The company's total revenue has grown to US$136 billion at the end of last year, from US$34 billion in 2010. Amazon recently snatched up Whole Foods Market for US$13.7 billion.

The "HQ2" project would initially need more than 500,000 square feet and up to 8 million square feet beyond 2027, Amazon said.

"We want to find a city that is excited to work with us and where our customers, employees, and the community can all benefit," Amazon said. Its Seattle campus spreads across 8.1 million square feet in 33 buildings and employs more than 40,000 people.

Seattle Mayor Ed Murray said his office immediately began conversations with Amazon about the company's needs and its long-term plans for operations in the city. "But, we also must know headwinds are coming. Unprecedented growth will not happen forever and my upcoming budget will reflect that."

Incentives for Amazon’s new headquarters could make sense as a long-term investment that could change the image of a metropolitan area, said Michael Mandel, chief economic strategist for the Progressive Policy Institute, a liberal think tank.

“The question is, how much of a tax break would you have given to have Apple set up shop in your state? It’s not so much the jobs as becoming a focal point for growth. No one can put a price tag on that.”

One gripe among corporate watchdogs is the amount of actual state and local income taxes companies pay.

For instance, according to data from the Institute on Taxation and Economic Policy (ITEP), between 2008 and 2015, there were 240 profitable companies among the Fortune 500 that fully disclosed their state and local income tax payments. They paid state income taxes equal to less than 2.9 percent of their U.S. profits.

"Since the average statutory state corporate tax rate is about 6.25 percent (weighted by gross state product), that means that over this period, more than half of their profits escaped state taxes entirely," ITEP reported in April.
Amazon becomes the second trillion-dollar company in the United States.