The review of Net Profit Margin witnessed a surging trend. The Net Profit Margin improved from 4.13% in 2019 to 5.29% in 2023.
The average EBIT Margin for the period under analysis was 5.01%, with 2022 and 2023 performing the worst and best,
In the current year, Amazon was able to cover its interest liabilities 11.58 times in the current year- compared to 2019 when it was 9.09 times.
The Asset turnover stood at 1.09 times in 2023 from 1.25 in 2019, implying a low performance on Assets of the business in relation to revenue.
Profitability
The revenue of Amazon has increased year on year. The revenue increased by 38% between 2019 and 2020 and a further 22% increase was recorded between 2020 and There also occurred an increase of 12% between 2022 and 2023 (the current period).
Amazon’s performance in profitability looks good as the return on capital employed also recorded good performance during the period of analysis.
Liquidity
The company’s result in liquidity looks strong, as current ratio/acid test reduced from 1:1/0.86:1 to 1.05:1/0.84:1 on the last year. This reduction is minimal, which implies that the company has enough assets to settle its current liabilities.
Capital Structure
Amazon is both equity and debt financed.
The debt-to-equity (D/E) ratio has been falling year on year. The gearing position of the company appears to be high as it stood at 1.61% in the current year.
