With Amazon upping the size of its M&A deals and increasing its acquisition activity, we looked at its all-time largest deals in a visual timeline.
As we discovered in our analysis of Amazon’s M&A strategy, Amazon has traditionally been a conservative buyer. Despite the historic Whole Foods mega-acquisition ($13.7B) as well as a few big-name buys like shoe retailer Zappos ($1.2B, 2009) and e-sports streaming site Twitch ($970M, 2014), on the whole Amazon has historically been far less acquisitive than its tech giant competitors.
The tide, however, seems to be turning. Last year, the company made 10 acquisitions, far and away Amazon’s most active year for M&A. This year, there have been only 3 acquisitions so far, but 2 have been for about $1B or more.
Most recently, Amazon pushed further into healthcare with its acquisition of D2C prescription pill company PillPack. In February, Amazon bought Ring for $1.8B, expanding its smart home footprint.
This follows last year’s mega Whole Foods acquisition, as well as Amazon’s purchase of Souq for $580M.
With its acquisitions now happening faster and at much greater purchase prices, we created a visual timeline of Amazon’s all-time largest deals.
Please click to enlarge.
Amazon’s Top Acquisitions
Whole Foods Market: $13.7B
One of Amazon’s acquisitions is not like the other — the Whole Foods acquisition dwarfed the company’s second-largest acquisition nearly by a factor of 8 and dramatically expanded Amazon’s brick-and-mortar footprint. In the long run, the acquisition gives Amazon a much stronger position in grocery delivery that capitalizes on Whole Foods’ large and loyal customer base.
Smart home technology could become ubiquitous in the near future. Amazon is poised to become a leader in the sector with its ownership of smart doorbell manufacturer Ring and as Alexa integrates with a diverse and growing suite of other smart devices.
Amazon’s first $1B+ acquisition went to a company that built its brand on customer centricity and a unique culture. Zappos fit neatly with Jeff Bezos’ relentless customer-focused approach and brought an online competitor into the fold.
The latest jewel in Amazon’s increasingly heavy crown costing supposedly just under $1B, the acquisition of PillPack is noteworthy because it confirms Amazon’s long-rumored entry in healthcare. The markets reacted accordingly, with share prices for incumbent pharma companies diving nearly 10% on the news.
Twitch Interactive: $970M
Amazon’s nearly $1B acquisition of Twitch raised eyebrows at the time, but since then, Amazon has capitalized on its fiercely loyal fanbase to provide a competitive advantage as major tech companies zero in on cloud-based gaming as their next big market.
Kiva Systems: $775M
Amazon’s purchase of Kiva, a robotic fulfilment system manufacturer, was the company’s 25th M&A deal since 2007 and one of the most impactful to its long-term business — no e-commerce competitors have come close to replicating Amazon’s warehouse automation.
By acquiring the Middle Eastern e-commerce firm Souq, Amazon gained a beachhead in a growing market before entries by its competitors like Walmart and Jet.com. International expansion remains a focal point of Amazon’s forward-looking strategy, particularly in emerging markets.
Quidsi — the parent company of Diapers.com — was one of Amazon’s largest acquisitions at the time. Just two years after the deal, Quidsi co-founder and co-CEO Marc Lore jumped ship to launch Jet.com, which Walmart subsequently acquired for $3.3B in 2016. Amazon ultimately shut down Quidsi in 2017, citing profitability concerns.
Annapurna Labs: $370M
Amazon’s acquisition of Annapurna Labs remains one of the most cryptic deals in the company’s history, with no confirmation as the size of the deal or why Amazon decided to acquire the Israeli startup. In 2016, Annapurna released a line of chips that seem to take aim at the low-power market.
Lovefilm International: $312M
Amazon acquired the “Netflix of Europe” in 2011, back when the DVDs-by-mail model was still robust and online streaming was only beginning to achieve widespread popularity. 6 years later, with DVD rentals all but extinct, Amazon shuttered Lovefilm and transitioned its employees to Amazon Prime Video.
Amazon started as an online book seller, and it didn’t stray from its roots when it completed its first major acquisition in 2008. In the decade since then, the audiobook market has become the fastest-growing segment in publishing, and Audible remains the market leader.
AWS Elemental: $296M
AWS Elemental — then known as Elemental Technologies — was acquired to integrate its high-speed video capabilities into the AWS platform. Elemental’s technology underpinned the AWS Media Services suite announced in 2017.
A few takeaways from the graphic:
- At a whopping $13.7B, Amazon’s recent Whole Foods acquisition is by far the largest acquisition. That’s more than 7 times the size of the second largest deal, the $1.8B purchase of Ring.
- 8 of the top 12 deals were at valuations of $500M or greater.
- 3 out of the 4 deals worth about $1B+ have happened since 2017.
- The smallest deal to make the top 12 was Elemental Technologies, which was valued at $296M.
- The deals reflect Amazon’s extremely diverse business interests: media and content (LoveFilm, Twitch, Audible), streaming infrastructure (Elemental), e-commerce (Souq, Quidsi, Zappos), computing hardware (Annapurna Labs), robotics (Kiva Systems), smart home (Ring), and healthcare (PillPack).