AMZN · Consumer Internet · Cloud Infrastructure
Amazon.com, Inc.
CoreThe business
Amazon is the business that taught the modern world what a flywheel is. A retail engine of unmatched scale sits alongside Amazon Web Services — a cloud infrastructure franchise that funds the whole enterprise — with advertising and logistics now compounding on top. Few companies reinvest as aggressively, or as intelligently, in widening their own moat.
The flywheel
Lower prices bring more customers; more customers bring more sellers and volume; greater scale lowers cost and funds infrastructure that lowers price again. AWS and advertising are higher-margin loops layered onto the original retail wheel, each turn financing the next. Free cash flow — not reported earnings — is the true measure of the machine, and it has structurally inflected upward.
Why we own it
- A genuinely multi-engine flywheel: retail, cloud, advertising, and logistics each reinforce the others.
- AWS remains a durable, high-return franchise with a long runway in enterprise and AI workloads.
- Management has a multi-decade record of prioritising long-term cash flow over quarterly optics.
- Scale advantages compound rather than erode — the business gets harder to displace as it grows.
Key risks
- Regulatory and antitrust scrutiny across multiple jurisdictions.
- Cloud growth is cyclical and increasingly competitive at the margin.
- Heavy reinvestment can mask near-term margin pressure if discipline slips.
Our recommendation
Amazon anchors the portfolio. It is the clearest living example of our thesis — a compounding machine that the market repeatedly underestimates by focusing on earnings rather than cash flow. We hold it as a core position and intend to keep holding while the flywheel turns.
This note reflects the views of Flywyl as of May 2026 and is provided for informational purposes only. It is not investment advice, an offer, or a solicitation to buy or sell any security. Views and positioning may change without notice. Past performance does not guarantee future results, and all investments carry risk of loss. Figures and qualitative ratings are illustrative of our internal framework and should be independently verified.