Amazon joins Apple in exclusive $1 trillion club

Sept. 4 (UPI) -- Retail giant Amazon entered rarefied air Tuesday, by becoming just the second U.S. company to surpass $1 trillion in total market value.

Now, Amazon and Apple combine for more than 8 percent of the entire S&P 500. Put into context, it would take the combined 2017 profits of 17 of the largest big box retail stores, including Walmart, to equal a market value of $1 trillion.

Shares of Amazon surged 2 percent in trading Tuesday, to $2,050 a share, which pushed the company's valuation above the $1 trillion mark.

Seattle-based Amazon accomplished this in large part because investors were patient with the 24-year-old company while it built infrastructure of fulfillment centers and innovated its ordering process.

"They've proven they can make it work," said analyst Michael Lippert. "They're spending a lot on all these things to build and enforce their competitive advantage."

Amazon reported a record net income of more than $2.5 billion in the second quarter, up from $197 million the year before. Amazon Web Services, advertising and Prime membership subscriptions are its main sources of revenue.

Amazon's milestone came almost exactly a month after rival Apple passed the mark. Next in line could be Google and Microsoft. Facebook was on a trajectory to reach $1 trillion, but has lost momentum since its data privacy scandal.