Is Amazon Stock Halal? A Detailed Sharia Analysis

Quick Verdict

Amazon (AMZN) is generally considered halal, though it sits in a more complex position than Microsoft or Apple due to its diversified business model. Most major Islamic screening agencies include Amazon in halal portfolios, but there are specific concerns worth examining — particularly around Amazon's financial services arm and entertainment content.

Amazon's Business Breakdown

Understanding Amazon requires knowing that it's essentially three companies rolled into one:

• AWS (Amazon Web Services) — ~16% of revenue, ~70% of operating profit: Cloud infrastructure services. Entirely halal.
• North America E-commerce — ~60% of revenue: Online retail. Selling goods online is permissible.
• International E-commerce — ~22% of revenue: Same as above.
• Other (Ads, Subscriptions) — ~2%: Prime Video, Alexa, Amazon Music, advertising.

Financial Screening

• Total Debt / Market Cap: ~8% ✅
• Interest Income / Total Revenue: ~0.3% ✅
• Cash-Based Receivables / Total Assets: Within acceptable range ✅
• Haram Revenue / Total Revenue: Under 5% ✅

Amazon's massive revenue base means that even its entertainment content (Prime Video) represents a small percentage overall. The financial ratios are comfortably within Sharia limits.

Key Concerns

1. Prime Video Content

Amazon Prime Video streams movies and shows that include mature content, violence, and adult themes. The question is whether producing/distributing such content disqualifies the company from halal status. Most scholars apply the 5% revenue threshold — since Prime Video is bundled with Prime shipping and ads revenue, the actual attributable "haram" content revenue is under 5% of Amazon's total. This is the standard ruling that makes Amazon acceptable.

Some more conservative scholars disagree and would exclude Amazon on these grounds. As always, consult a qualified scholar if you have doubts.

2. Amazon Pay and Financial Services

Amazon offers "Buy Now, Pay Later" through partners and Amazon Pay Later, which involves interest-based credit. However, Amazon itself is not the lender — it acts as a marketplace connecting customers to third-party lenders. The revenue Amazon earns from this is minimal relative to its total business.

3. Alcohol and Prohibited Products in the Marketplace

Amazon's marketplace sells alcohol, pork products, and other haram items through third-party sellers. Amazon acts as a platform, not the manufacturer or primary seller. Most scholars view this the same way they view a shopping mall that has a liquor store inside — the platform owner isn't responsible for every tenant's goods, provided the haram commerce doesn't constitute the majority of the platform's revenue.

4. AWS and Defense Contracts

AWS holds significant US government and military contracts. This is worth noting, though most Sharia scholars don't disqualify companies for providing neutral technology services (cloud computing, storage) to defense clients. Direct weapons manufacturing would be a concern — AWS providing cloud services is a step removed.

Screening Agencies' Verdict

• MSCI Islamic Index — Included ✅
• S&P 500 Sharia Index — Included ✅
• Zoya App — Compliant ✅
• SPUS ETF (SP Funds) — Held ✅

Purification

Amazon doesn't currently pay dividends, so there's no dividend purification needed. If you receive income through stock sales, no purification is required since Amazon's haram-source revenue is already under the 5% threshold. However, if you're particularly cautious, donating 0.3% of any gains to charity is a safe approach.

Bottom Line

Amazon passes mainstream Sharia screening and is held in major Islamic equity funds. The concerns around Prime Video content and third-party marketplace sales exist but remain under the 5% threshold. If you're comfortable with the mainstream screening methodology, AMZN is a permissible investment with minor purification considerations.

If you prefer a more conservative approach, consider investing through a Sharia-supervised fund that does this analysis for you.