Amazon vs Alphabet
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KIRA’s take AI analyst
I put Amazon and Alphabet side by side, using each one’s latest annual report. Here is what stands out:
- Amazon is the larger business, with $716.9B of revenue in fiscal 2025 against $402.8B for Alphabet, about 1.8 times as much.
- Alphabet grew revenue faster (15.1%, against 12.4%).
- Alphabet kept more of each dollar of sales as operating profit (32.0% operating margin, against 11.2%).
- Alphabet turned more of its sales into free cash flow (18.2% FCF margin, against 1.1%).
- Alphabet earned a higher return on the capital invested in it (36.7%, against 20.6%).
- Investors pay more for each dollar of Amazon’s earnings: a P/E of 20.4x against 16.1x for Alphabet.
Who comes out ahead
Of the 11 measures where higher (or lower) is clearly better, how many each company leads.
Amazon
AMZN
0/11
Alphabet
GOOGL
11/11
Revenue growth5-year growthGross marginOperating marginNet marginFCF marginReturn on capitalReturn on equityPiotroski F-scoreNet debt / EBITDAShare count change
Side by side
Best in the row
| Latest fiscal year | AMZN FY25 | GOOGL FY25 |
|---|---|---|
| Size | ||
| Market cap | $2.76T | $3.95T |
| Revenue | $716.9B | $402.8B |
| Free cash flow | $7.7B | $73.3B |
| Net income | $77.7B | $132.2B |
| Growth | ||
| Revenue growth | 12.4% | 15.1% |
| 5-year growth | 13.2% | 17.2% |
| Share count change | 1.0% | −1.7% |
| Profitability | ||
| Gross margin | 50.3% | 59.7% |
| Operating margin | 11.2% | 32.0% |
| Net margin | 10.8% | 32.8% |
| FCF margin | 1.1% | 18.2% |
| Return on capital | 20.6% | 36.7% |
| Return on equity | 22.3% | 35.7% |
| Balance sheet | ||
| Net debt | −$41.5B | −$75.3B |
| Net debt / EBITDA | −0.3x | −0.5x |
| Dividends and buybacks | $0.0M | $55.8B |
| Valuation & quality | ||
| P/E | 20.4x | 16.1x |
| Piotroski F-score | 6 | 8 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.