Billionaire Peter Thiel’s hedge fund, Thiel Macro, disclosed its latest portfolio in a regulatory filing last month, and the fund’s largest reported position (a stake worth about $118 million as of June 30) is e-commerce and cloud computing giant Amazon (AMZN -0.15%).
But I’d argue the filing itself is less notable than the track record behind its biggest pick. In early September 2016, Amazon shares closed at a split-adjusted $39.44 (the company split its stock 20-for-1 in 2022). At Friday’s closing price of $258.51, a $10,000 investment made a decade ago is worth about $66,000 today — a return of about 555%, or nearly 21% annualized.
And that’s price appreciation alone. Amazon doesn’t pay a dividend.
What produced that return, and could the company possibly do it again?
Image source: Amazon.
The profits grew even faster than the stock
The Amazon of 2016 was a very different company. That year, it generated $136 billion of revenue, $4.2 billion of operating income, and just $2.4 billion of net income. Investors were paying more than 100 times earnings for a business that was barely profitable.
By 2025, revenue had more than quintupled to about $717 billion. Net income grew about 32-fold over the same period, reaching $77.7 billion. In other words, Amazon’s bottom line compounded far faster than its share price did.
That gap explains a lot. The stock’s big decade didn’t come from investors paying a higher premium for Amazon’s earnings. Shares cost about 24 times next year’s expected earnings today, a fraction of what buyers were paying in 2016. The business simply outgrew its price.
The profit engine
Most of the transformation traces to Amazon Web Services (AWS), the company’s cloud computing segment. In 2016, AWS generated $12.2 billion of revenue (about 9% of Amazon’s total), yet its $3.1 billion of operating income accounted for most of the company’s overall operating profit. By 2025, the segment’s revenue had grown more than tenfold to $128.7 billion, and its operating income reached $45.6 billion.
Notably, the segment became more profitable as it scaled, with its operating margin expanding from about 25% to about 35% over the decade.
And AWS’s growth is speeding up, not slowing down. Segment revenue rose 20% in 2025, with growth picking up as the year went on and reaching 24% year over year in the fourth quarter.
“AWS is booming, growing 36.7% year-over-year in Q2 — our fastest growth in 18 quarters — and our AI and Chips businesses each eclipsed run rates of more than $25 billion,” said CEO Andy Jassy when the company reported second-quarter results in July.
In dollar terms, that was $42.2 billion of AWS revenue in the second quarter alone — an annualized pace of about $169 billion.
The cloud isn’t Amazon’s only newer profit stream, either. The company’s advertising business, which Amazon didn’t even report as its own revenue line a decade ago, generated $19.8 billion of revenue in the second quarter, up 26% year over year. That’s faster growth than the overall company posted, and an annual pace approaching $80 billion.
Can the next 10 years measure up?
A repeat of the past decade is a high bar. Another 555% gain would take Amazon’s market value from about $2.8 trillion today to roughly $18 trillion. That’s far more than any public company is worth today. I wouldn’t plan on that.
However, the stock doesn’t need a repeat to reward shareholders. It needs profits to keep compounding.
Today’s Change
(-0.15%) $-0.39
Current Price
$258.51
Key Data Points
Market Cap
Day’s Range
$255.29 – $261.12
52wk Range
$196.00 – $287.20
Volume
30.7M
Avg Vol
48M
Gross Margin
50.77%
And Amazon is spending aggressively to make sure they do. In fact, the investment is heavy enough that free cash flow over the trailing 12 months swung to an outflow of about $7.6 billion, largely reflecting spending on artificial intelligence (AI) infrastructure.
Of course, an outflow like that may look alarming, and the spending could weigh on profit margins for a while. But heavy investment ahead of the payoff is also how AWS got built in the first place.
Would I buy Amazon stock today?
I would, though not because Thiel’s fund owns it. A quarterly filing shows where a fund stood weeks ago, not what anyone should buy today. The better reason is the business itself: It arguably looks stronger than it did a decade ago, and a price of about 24 times next year’s expected earnings seems reasonable for a company still growing this quickly.
I just wouldn’t buy shares expecting a repeat of the past 10 years. If the profits keep compounding, the stock should do fine.
