The other day I came across this interview with Jim Cramer and the CEO of Amazon Web Services, Andy Jassy. Some of the stats Andy quoted puts the potential of the AWS business into perspective.
AWS has annual revenue of around $30bn. Growing around 45% per year. He believes that the US is still in the early stages of cloud adoption. The potential in the US is still huge. Even more exciting is that he believes the rest of the world is about 12-36 months behind the US.
Who would have thought that this business would become so influential for Amazon? Who knows, it may even overtake the online retail business as Amazon's core function. It is already the most profitable contributor by far.
It was very hard to tell how successful this business would become if you bought Amazon shares 5 years ago at $370 a share. Yes, you may have believed the cloud would become big but knowing that Amazon would dominate and make this much money from the business was virtually impossible. When you invest in good companies with good management your chance of getting lucky increases.