Currently buying & building eCommerce businesses. I used to work at Amazon; now I just sell stuff there.
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Joined March 2012
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I went back and looked at a sample of 50 Amazon FBA businesses that were on the market at the end of 2024. Here's what the Amazon fee load of that sample looked like:
TOTAL AMAZON FEE LOAD (FY2024)
25th Percentile: 55.0%
Median: 60.5%
75th Percentile: 65.0%
This breaks down as:
FBA FEES
25th Percentile: 27.3%
Median: 33.7%
75th Percentile: 39.8%
REFERRAL FEES
25th Percentile: 15.4%
Median: 15.8%
75th Percentile: 16.1%
TACOS
25th Percentile: 7.7%
Median: 9.9%
75th Percentile: 13.0%
When I look at investing in companies, if you have any level of dependency on Amazon, its a negative. I would love to have people post what percent of sales in fees from Amazon and Walmart they are experiencing
The numbers I have seen are INSANE AND UNSUSTAINABLE.
That's one of the key reasons why protecting American companies from knock offs is so important.
Bearded Egg FBA 🛠️ retweeted
Why is the stock market getting NUKED right now?
Google -12.6%, Amazon -7%, Intel -25%, Nasdaq futures down 2%+... and it's happening after these companies posted some of the best cloud growth we've EVER seen
Here's what you need to know as an investor:
1. Google missed on revenue and EPS, search growth slowed to 12%, and free cash flow came in at NEGATIVE $9.07B after $51.4B of capex in a single quarter. The stock had its worst day in 20+ years and lost about $500B in value
2. Amazon piled on last night. AWS grew 39% (fastest in nearly 5 years) and Amazon posted its highest operating margin ever... but trailing 12-month free cash flow went to NEGATIVE $42.4B, from +$14.8B a year ago. And it signaled capex goes UP again next year
3. Intel finished the job. Weak Q4 guide, a PC slump, and a warning that it'll burn cash this year. Stock -25% premarket, dragging every chip name down with it.
One thing to note from all of this:
Nobody is worried about AI DEMAND. Demand is the one thing every company confirmed. Google Cloud more than doubled, Azure grew 48%, AWS is accelerating and still can't build capacity fast enough
So to be clear, demand is NOT the issue. Any bear who's focused on demand should be muted, they are out to lunch
The fear right now is the BILL
The 4 big hyperscalers free cash flow was -$26B combined. 3 of the 4 are now spending more than their businesses bring in
So they're borrowing more and more to fill that gap. Amazon's long-term debt went from $66B to $173B in just 9 months
These companies used to be the biggest cash machines on earth, buying back their own stock. Now they're issuing bonds to keep building. THAT'S the shift the market is repricing and struggling to wrap their head around... even though FCF is expected to go positive by the end of next year, and significantly higher into 2028
But here's the ironic part. Every dollar of that capex is REVENUE for somebody else: the chip, memory and power companies building this stuff out. Yet $MU is still down ~5% this morning. The market is selling the spenders AND the companies getting paid... it makes no sense!
I'm seeing people on X call this the AI bubble popping. Once again, I don't see it. Bubbles pop when demand dries up. Here demand is accelerating and these companies are spending MORE because they can't build fast enough. What's being repriced is how long investors are willing to wait for the cash
I continue to believe these dips are for buying and we go much higher as the market realizes that this negative fcf is only short-term and the revenue is showing up in many different places from AI
This is not a bubble, this is one of the greatest investing opportunities of our lifetime and the market continues to give us gifts at these prices. Take a look at what dips I'm buying and what my real-time portfolio looks like here: link.milkroad.com/t5837z
Don't forget to give me a follow @kylereidhead for more insights on AI and markets
ALT Watchlist showing GOOGL down 12.6%, MU down 5%, AMZN down 4.3% and other AI names lower
Q3 Amazon Ads revenue was $1B short which, for brands and sellers, means…
Bearded Egg FBA 🛠️ retweeted
Example of how Amazon (in my opinion) unethically increases prices while claiming that it's not:
Prior to March 2025, when Amazon lost a product that we stored in its warehouses, it would reimburse us equal to what we would be paid, had we sold that item.
Now Amazon doesn't do that.
It reimburses us according to the cost of the item.
They won't pay the shipping costs we paid to move that item to the United States. They won't pay the tariffs we paid to import the item. They won't pay the shipping costs we paid to get it to Amazon. And they won't pay the storage fees Amazon charged us to store the item until they lost it.
They'll only pay the cost of the item, which we must prove to them by revealing our supplier and cost information, which most suppliers consider sensitive.
It gets worse.
Amazon, after reimbursing for the item they lost (or broke), can then sell the item. Sometimes they lose items and find it later. So they'll sell it. When they sell it, the money goes to them, so they get the full original reimbursement, not just the product cost.
Not only that, when Amazon sells the item, they are taking a sale away from the seller and maker of the item.
You may think, so what big deal, it's just reimbursements. These reimbursements can be $100,000s or $1,000,000s a year for some sellers because Amazon is constantly losing and breaking products.
In fact, with the way they've set up the system, they even have an INCENTIVE to lose and break the products, because they can sell them for more later.
The change in policy isn't just unfair, it greatly increases costs for Amazon sellers, but it's not a direct cost increase.
Amazon is still reimbursing, they're just doing it differently. That's different from increasing all their prices by 5% so they can stay stuff like "we only increased prices 3.5%, lower than industry averages". What they're not saying is that they also changed prices that are complicated, that people outside of Amazon don't understand, to increase costs and juice their bottom line.
Of course these cost increases, sellers eventually notice (or go bankrupt) and when they happen, we have to raise prices, so consumers pay.
So while Amazon saying they haven't raised prices might be legally true, practically and ethnically, it's not.
And it seems that they go to great lengths to hide this.
Bearded Egg FBA 🛠️ retweeted
FYI for FBM sellers: Amazon says that starting December 18, 2026, most US returns for seller-fulfilled orders will require a prepaid return label.
Within seven calendar days of a return request, sellers must upload the label through Manage Seller-Fulfilled Returns or issue a full refund without requiring the item back. If neither happens, Amazon says it may automatically issue a returnless refund and deduct the amount from the seller’s account.
Heavy and bulky items are temporarily excluded. Labels sent outside Amazon’s returns workflow won’t count.
Bearded Egg FBA 🛠️ retweeted
🚨 IS ELON MUSK BUYING $EBAY?
$EBAY is up +4.7% today, hitting a new all-time high, right as Elon Musk is publicly backing the idea of an $AMZN competitor.
Building an Amazon competitor from scratch would take years.
Buying eBay gives Musk overnight:
• 136M active buyers
• 2.6B live listings
• A massive global seller network
• Decades of transaction and pricing data
• Existing payments + marketplace infrastructure
Then combine that with X distribution, Grok-powered shopping agents, and X Money.
Suddenly, eBay isn't just an old marketplace.
It becomes the infrastructure for an AI-native commerce platform where agents search, compare, and buy products for you.
Amazon is actively restricting third-party shopping agents.
Musk wants the opposite direction.
If Musk seriously wants to build an Amazon competitor, acquiring $EBAY might be one of the fastest ways to do it.
And the timing of today's move is definitely interesting.
Bearded Egg FBA 🛠️ retweeted
It really does make sense:
- Prices on Amazon have increased drastically since Jassy took over, because 3P seller fees go up every year
- Chinese sellers dominate Amazon because they have been given significant advantages over US sellers
This happened to my accounts as well
So this morning we noticed all of our Amazon images are changed in seller central. It looks like this is ai? @amznsellerhelp Is this something Amazon is testing now? If so, it a complete mess. Also seeing images removed from our live PDP and wrong product images being used.