Amazon's Next Business Is Hiding Inside Its Delivery Network

Amazon is launching Amazon Supply Chain Services, leveraging its logistics infrastructure for external customers beyond its core e-commerce, AWS, and advertising businesses. ASCS targets residential parcel delivery, offering lower rates and simpler pricing to attract third-party volume, improving network utilization and operational efficiency. Base and strong case scenarios suggest ASCS could contribute 2–5% of annualized operating income, with the primary benefit being cost savings in Amazon’s retail logistics. I rate AMZN a Buy, as ASCS enhances logistics economics and offers upside potential beyond AWS and AI, with further value possible from freight and international expansion.

Amazon ( AMZN ) traditionally has three businesses: e-commerce, Amazon Web Services, and advertising. Soon, a fourth business is going to be added to this. This is ASCS, or Amazon Supply Chain Services.