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At Long Last, Amazon's Jeff Bezos Confirms Just How Many Prime Members There Are

By Evan Niu, CFA - Updated Apr 19, 2018 at 2:53PM

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But where are all those Prime members located?

For years, (AMZN -7.16%) has closely guarded just how many Prime members it has, leading to much speculation. The e-commerce titan has consistently obfuscated this metric with a standard phrase: "tens of millions." Amazon used the same phrase recently when discussing how many music subscribers it has, the first such time it has given any detail regarding its music business.

Well, CEO Jeff Bezos has just released Amazon's annual shareholder letter, and he has finally disclosed how many Prime members the company has.

Amazon packages on a conveyer belt with a warehouse worker in the background

Image source: Amazon.

100 million and counting

To be clear, Bezos did not provide an exact figure, but instead noted that Amazon has now "exceeded 100 million paid Prime members globally," 13 years after the program was introduced. It's not clear how far above 100 million the member base is. Over the years, Amazon has continued to stuff more and more benefits into Prime, to the point where it's a no-brainer for most e-commerce shoppers, providing incredible value and convenience.

The richest man in history also noted that Amazon shipped over 5 billion items with Prime worldwide last year, and 2017 saw the greatest number of new Prime members than any other year. That includes member additions in the U.S. as well as international markets, although Bezos stopped short of providing any other granular detail regarding the Prime member base, such as a geographical breakdown.

Such a breakdown would be crucial in estimating how much Prime revenue Amazon ultimately brings in, as Prime is priced differently based on geographical market. For example, Prime costs just 999 rupees in India, or $15, compared to the $99 annual fee in the U.S. Prime launched in India in 2016, and Amazon is still in the early stages of building out its infrastructure in the world's second-most-populous nation, and doesn't include as many benefits as the U.S. version (yet).

Prime launched in Mexico during 2017, with an introductory annual fee of 449 pesos (about $25), which jumps to 899 pesos (about $50) after the first year. Earlier this year, Amazon raised the monthly fee of Prime in the U.S. from $11 per month to $13 per month in an apparent effort to encourage annual subscriptions, as the price increase only affected monthly subscribers.

It's fair to say that most of the Prime member base is located in the important U.S. market, but only Bezos and Co. know that breakdown. Inevitably, Street analysts will offer opinions and estimates in the days and weeks ahead. The disclosure is a small but meaningful step for investor transparency, which Amazon has a poor track record with. It took years for Amazon to start sharing detailed financials for its all-important Amazon Web Services (AWS) division, which is now the company's most profitable segment by far.

Fortunately for investors, it'll be quite a while until Amazon can start hiding behind proclamations of "hundreds of millions" of Prime subscribers. 

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