Jeff Bezos’ Amazon.com Inc. (NASDAQ:AMZN) 24 years ago, during the 2000 dot-com bubble crisis, the country was once almost out of cash. It reportedly once had just ten months’ worth of cash, while its stock price plummeted from $107 to $7.
Fast forward to 2024, Amazon is expected to have almost as much cash on its balance sheet as its competitors Apple Inc. (NASDAQ:AAPL) and Microsoft Corp. (NASDAQ:MSFT) combined by 2027.
Don’t miss:
What happenedAmazon is expected to raise $127.4 billion in cash and short-term investments by the end of the year, according to S&P Global Market Intelligence, Business Insider reported.
This figure exceeds the cash reserves of technology giants Alphabet Inc. and Microsoft, which amount to $112.8 billion and $108.1 billion, respectively.
By 2027, Amazon’s cash reserves are expected to approach $400 billion, a significant shift for a company that has traditionally focused on reinvestment rather than cash accumulation.
Popular: ‘Scroll to UBI’: Deloitte’s fastest growing software company empowers users to make money on their phones – invest with €1,000 today for just €0.25/share
Wall Street is now speculating whether Amazon will follow in the footsteps of other tech companies by returning some of this money to shareholders through buybacks or dividends.
Apple is expected to have a cash hoard of $106.51 billion, while Microsoft is expected to amass $300.88 billion, bringing the combined total to $407.39 billion for two of the world’s most valuable companies by market capitalization.
See also: This Jeff Bezos-backed startup lets you become a landlord in just 10 minutes, and you only need $100.
For context, during the 2000 dot-com bubble crash, Amazon’s stock plummeted and the company’s cash reserves also fell. Bezos, however, was unfazed. “Well, we’re a famously unprofitable company,” he said.
“And that is a conscious strategy and an investment decision.”
Popular: The global games market is expected to generate $272 billion by the end of the year. At $0.55 per share, this venture-backed startup with a user base of over 7 million investors provides easy access to this asset market.
Why it mattersAmazon’s increasing cash reserves come at a time when the company is making strategic moves to strengthen its market position.
Recently, Cathie Wood’s Ark Invest made a significant investment in Amazon, purchasing 76,505 shares despite concerns about the company’s growth trajectory. The move followed a downgrade of Wells Fargo’s rating, citing slowing growth and increased competition.
Additionally, Amazon is preparing for the holiday season by expanding its workforce by 250,000 employees to meet the demands of the retail wave. This hiring spree underscores Amazon’s commitment to maintaining its competitive advantage in the retail sector.
As Amazon’s cash reserves grow, the company is under pressure to balance reinvestment strategies with potential shareholder returns, a decision that could have a significant impact on its future financial trajectory.
Read next:
Disclaimer: This content was produced in part using AI tools and was reviewed and published by Benzinga’s editorial staff.
Photo courtesy: Shutterstock
Next: Transform your trading with Benzinga Edge’s unique market trading ideas and tools. Click now to access unique insights which can give you an edge in today’s competitive market.
Want the latest stock analysis from Benzinga?
This article Jeff Bezos almost ran Amazon with no money 24 years ago. At $400 billion, it is now expected to have as much money as Apple and Microsoft combined by 2027: Here’s More originally appeared on Benzinga.com
