S&P Dow Jones India announced on Tuesday that Amazon will replace Walgreens Boots Alliance, a U.S. healthcare, pharmacy and retail businessman, as a constituent of the Dow Jones Industrial Average. S&P Dow Jones Indices manages 30 weighted indices. Amazon shares were trading in after-hours trading**1% and WBA shares**3%.
The move will give investors more exposure to the ** retailer, whose bets are much smaller than the average of the S&P 500. This change will take effect before the market opens on February 26.
S&P Dow Jones Indices said in a statement: "This change reflects the changing nature of the U.S. economy and will increase consumer retail exposure as well as other business areas of the Dow Jones Industrial Average."
The company said the adjustment was "driven" by Walmart's 1-to-3 split, which led to a decline in Walmart's weighting in the index, triggering the index component adjustment, and Walmart will remain in the Dow Jones Industrial Average.
Today, Amazon is more than just a "leading book retailer," as the company described itself to investors before its initial public offering (IPO) in 1997. It has been run by Andy Jassy, who built the Amazon Cloud business, since 2021. This segment leads the market, providing Amazon with 14% of revenue and the majority of operating profits.
Jeff Bezos is the founder of Amazon and the only CEO before Jesse, who is the company's executive chairman. Bezos is the second richest person in the world, according to one measure, having sold billions of dollars in ** in recent weeks.
In addition to cloud computing, Amazon also brings in revenue from promoting products in search results. Amazon's advertising business grew revenue by 27% in the fourth quarter, outpacing Alphabet (Google's parent company), Meta and Microsoft.
Three years ago, business software makers Salesforce, Amgen and Honeywell International joined the Dow Jones index.
WBA has been a component of the Dow since replacing General Electric (GE) in 2018, and GE has been a component of the Dow since 1896.
In the most recent quarter, WBA narrowed its loss to 2.8 billion from $3.8 billion in the same period last year$7.8 billion, excluding non-controlling interests. Amazon's fourth-quarter profit fell from 2$7.8 billion to $10.6 billion.