@smilie
Here's where you are confused, and since I run an ecommerce I'll help you:
Revenues: $142.57B
Total Cash (mrq): $21.53B
Operating Cash Flow (ttm)$16.81B << needs for operations, otherwise collapse
Levered Free Cash Flow (ttm) $10.51B << cash that isn't already guaranteed on other obligations
With all due respect I think you are confusing things. Revenue is an income statement item, total cash a balance sheet item and Cash flow, cash flow statement item. You cannot mix these things up.
Cash is cash. You can make cash appear or disappear to some extent using accounting smoke and mirrors but that is usually pretty evident. Either you have cash or you don't.
So let's look some common ways to "cook the books"
1- Go to the bank or other financial institution (loan sharks), and take out a big loan, and then voila! you have cash, but that is evident on the balance sheet. So let's compare
Cash + Shrt investments / Total liabilites Amzn: 21/60 or 1/3, WMT (walmart) 6.5/126 ~1/20, COST (Costco): 5/25 ~1/5. So if anyone is borrowing to hold cash it is Walmart.
2- Sell inventory and don't replenish the shelves. This great sign for company that is in financial trouble. But in this case we need to be cautious, because Walmart has many stores which require merchandise as does Costco, but Amazon doesn't. So let see if there are any sudden drops or downward trends in inventory. So Amzn has steadily increasing inventory over the past few years, which is inline with an increase in sales. Costco and Walmart both have steady inventory levels.
3- Another way to accumulate cash is to sell shares of the company or sell other assets. If you check the cash flow statement, you can see this under cash from financing and investment activities . For both these line items AMZN show negative values, as do Walmart and Costco. So no cash here.
So what is up, where is the cash coming from. In the previous year AMZN had 16B in cash from operating activities, of which about 20% went to paying debts. Walmart had almost double at 31B but paid out 18B to share holders and creditors.
So lets recap, Amazon has highest Gross margin ratio of any of the three, this is due largely to the fact that it holds minimal inventory. The money it makes is reinvested as the company pays no dividends and has little debt. Compare this to Walmart, they pay out a lot of money to share holders and creditors. So of the two, I think Amazon is in a much better position to take on a venture like this one.
Remember, as Life in Asia points out, in many transactions that are processed by Amazon, they never touch the goods, they simply connect buyer and seller and take their fat cut.
From what I have heard, there are many great reasons for this transaction with Whole Foods. The most credible is that the many of the Whole Foods locations are centered where Amazon has many Prime customers. Simply having a physical location, where customers can return or pick-up goods can be very beneficial. Then once in the stores, any additional transaction is free money. Specially when you consider self check out. In my opinion this is brilliant and scary all at once (at least on paper). Now these things rarely go as planned, so who knows, maybe Walmart will be there to pick up the pieces.
Sorry one last disclaimer, this transaction has just begun, so it is entirely possible that Amazon may choose to finance the transaction by borrowing, or scaling back on inventory or selling more stock, there is no way of knowing what will come, accounting always looks back. Stock markets tend to look ahead, and the share price is holding strong, but the market have been known to get it wrong sometimes.
