Amazon (NASDAQ: AMZN) is the world's largest retailer, and the company is now also profitable. For years, Amazon sacrificed profit for sales volume, but the company posted its second consecutive quarterly profit in October 2015. The stock price hit $624.90 on October 29, which is more than double the level of a year earlier. Amazon's e-commerce business dominates that sector, but the company's top four bets for 2016 are elsewhere.

Amazon overtook Walmart to become the world's largest retailer earlier this year. Other companies have tried to replicate and improve on Amazon's e-commerce model, but none has succeeded. Even as competitors struggle to compete in that core sector of Amazon's business model, the company has moved – successfully – in many other directions.

International Growth

Amazon continues to push for more international growth, especially in China. However, the Chinese e-commerce market is dominated by Alibaba and its affiliated sites. Amazon will need to build a great deal of infrastructure overseas in order to replicate the success it has in the United States.

Cloud Data Storage and Computing

Amazon is the leader in cloud data storage and computing, which will remain a focus and is expected to show continued revenue growth. Amazon Web Services reported $2.08 billion of revenue in the third quarter of 2015, which was up 78% from the same period in 2014.

Fire TV

Amazon's Fire TV and Fire TV Stick are the company's fastest-selling products ever and a major focus for 2016. Both are digital media players with 4K capability. Fire TV is a set-top box that competes with Apple TV and the original Roku design, while the Stick is a dongle that competes with Google Chromecast and the newer Roku streaming stick. Both support Netflix, Hulu, YouTube, Spotify, Pandora and all Amazon services (including Prime video); neither supports Apple's iTunes.


Amazon's Kindle universe encompasses both the original e-readers, which continue to dominate their sector, and the Kindle Fire, which competes with Apple's iPad. Sales of e-readers and books have been down over the past two years, with some people choosing to return to physical books as prices of the two formats converge. Amazon is opening its first-ever brick-and-mortar bookstore in Seattle.

The Kindle Fire starts at $49.99, far below the $269 for Apple's cheapest iPad Mini. The device allows Amazon to link sales and usage of all of its products and services in an affordable tablet; the value of those ancillary sales far exceeds the price of the device itself. The Kindle Fire supports the same services as the Fire TV devices: Netflix, Hulu, YouTube, Spotify, Pandora and Amazon Prime video. It does not support iTunes.

Original Content

Amazon Prime's original content will continue to be the company's main focus in 2016. Prime aims to knock Netflix off its spot as the top streaming service; it is now in second place, with 44 million subscribers compared with Netflix's 69 million. In the April to June 2015 period, 95% of expiring memberships were renewed.

Amazon Prime launched its original programming in 2013 in a format that it continues to use. The pilot episodes of potential series were made available to members only, and members subsequently voted on which shows they wanted to see continued. The winners went into production for full series. The first full series were "Alpha House," which was subsequently renewed, and "Betas," which was not.

The second season yielded the critical favorite and award winning transgender drama "Transparent" along with "Mozart in the Jungle," which is set in the world of classical music. Both have been renewed.

There are two major new series scheduled to debut by mid-2016: the crime comedy "Mad Dogs" and Ridley Scott's "The Man in the High Castle," which is based on an alternative end to World War II. They are joined by children's series "Just Add Magic" and "The Stinky & Dirty Show." Documentary series "The New Yorker Presents" rounds out the new additions. Woody Allen has also signed on to develop his first-ever TV series for Amazon, but its title and release date have not yet been announced.

Amazon has announced plans to produce 12 feature films. They are intended to be released first in theaters. The movies will be released on Amazon Prime within four to eight weeks of their theatrical releases. This is far quicker than the 16 weeks that has been standard, but that standard has been under pressure from the increased popularity of streaming video.