Actually, when Amazon is done with its malinvestment, it will still have a fundamentally inferior cost structure for the vast majority of product it sells compared to WMT, COST and TGT. And that's after spending billions building what they've already financed over decades of real cash flow from running the businesses to make money...
So, I was with a good buddy from Kellogg whose wife ordered 25, 50 and 75 lb freeweights for him for Christmas. Came in 3 separate shipments. He's a prime member... Good business model. Sure, it is an extreme example. But I'd love to hear the analysts explain why they think that is so good for Amazon. IMHO, it simply shouldn't carry stuff where the math doesn't and will not work.
The relative economics of clicks versus bricks depends upon product, category and consumer characteristics... and some macro drivers as well. Amazon is moving to digital content wherever it can because it knows the core online commerce economics for most physical products are one big fairy tale. But, it will not be able to capture meaningful rents there either.
The scam is almost exposed. This earnings report sows seeds of doubt. Next one exposes the scams real economics (holiday sales density masks the extent of the flaws).