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amazonprimeAmazon may have up to 50 million U.S. Prime subscribers, and as many as 60 to 80 million globally, according to a new survey.

RBC Capital Markets analyst Mark Mahaney said that the firm’s third annual Amazon consumer survey suggested U.S. Prime adoption has risen from 25 percent of customers in 2013 to 40 percent today, reports CNBC.

A year ago, Mahaney said that Amazon had up to 50 million subscribers globally, and between 30 to 40 million in the U.S. Amazon does not disclose the number of subscribers it has, but another frequently cited report estimated as recently as this summer that Amazon had 44 million U.S. Prime members.

Because of that amazing adoption rate, Mahaney raised his price target on Amazon to $705 from $650. This morning, the company’s stock is trading at a much more modest $519 a share.

In an interview on CNBC, Mahaney explained that the price target is not outrageous given that investors have started to take a much longer outlook on Amazon than they once had — even during periods of investing when the company does not earn a huge profit.

Amazon CEO Jeff Bezos
Amazon CEO Jeff Bezos

“The market is willing to — and should be willing to — look out several years and look at these pools of profit that they are building up in their core retail business and in AWS,” he said. “You do that, and you can get to materially higher price levels from where the stock is today.”

He added that Amazon is just starting to taper off from a four to five year investment period in new fulfillment centers, which is ensuring Amazon Prime’s success.

Amazon Prime is the $99 annual membership program that grants customers free two-day delivery on millions of items. Over the past couple of years, Amazon has been adding additional benefits to the program, such as free streaming TV. More recently, customers in some markets have received other benefits, like faster same-day delivery, or Prime Now delivery, which can get select items delivered to your front door within two hours for free.

RBC’s survey indicates that customers are not only willing to pay for the program, but that they spend more, too.

About 15 percent of non-Prime members spend more than $800 a year on Amazon, compared to 40 percent of Prime members, who spend an average of $800 during their first year. Four years into the program, and 70 percent of members are spending that much, he says.

The result of those spending trends means that revenue growth should be sustainable for much longer than people realize.

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