Amazon as a whole is profitable, but AWS subsidizes the rest. Amazon retail loses money because it's constantly undercutting competitors, and investing heavily in further CapEx to reduce costs.
If they had to pay living wages to those employees, they would stop being able to undercut every other business.
Without Bezos, when will AWS be spun off? It's a stock payoff for execs waiting to happen, and the execs can only turn a blind eye to that for so long.
Well, if Amazon spun off AWS they would have no choice but to treat all the retail-side issues (counterfeit goods, BS reviews, garbage search results, shoddy delivery subcontracts, facilitating the sale of stolen merchandise, warehouse working conditions) as actually worthy of Day 1 focus. Are they ready to do that? Unfortunately it's not as glamorous as building rocket ships, buying news companies or building web service infrastructure...
If they had to pay living wages to those employees, they would stop being able to undercut every other business.