Amazon Isn't Looming As A World Conqueror

Despite the scale of its global efforts, it’s surprising to see the e-comm giant’s relatively lacklustre growth outside the US market

- Shira Ovide

International expansion is one of Amazon.com Inc.’s greatest opportunities. The company generates close to two-thirds of its e-commerce revenue in the US, but it has been bulking up its bet on India and stretching its Prime shopping club into more countries to bring JeffBezos’s online bazaar to the world.

The scale of those international efforts makes it surprising to see Amazon’s relatively lagging growth outside its home market. Amazon posted roughly the same or quicker e-commerce revenue growth in North America than outside for 11 out of the last 14 quarters, adjusted for foreign-currency movements and making a rough estimate of the lift from Amazon’s acquisition of Whole Foods.

This is not an anomaly. In research published this month, RBC Capital Markets analyst Mark Mahaney said the annual growth rate of Amazon’s core North America e-commerce segment had topped currency-adjusted international growth each year since 2010.

The pessimistic take on these figures is that Amazon’s international segment isn’t pulling its weight despite heavy investment and the debut of Amazon’s e-commerce services and Prime in more countries. The optimistic scenario is that Amazon is poised for explosive growth once its globe-trotting strategy takes hold.