Amazon’s Lockdown Sales Start To Slow
Amazon was one of the big winners of the ongoing pandemic, but the rush to digital retail has slowed as more of the world begins to open up, and people rediscovery the joys of bricks and mortar shopping.
Amazon reported that its sales estimates for the June quarter fell shorts of the company’s own estimates, the first time they have done so since 2018. Shares dropped 7 per cent after this announcement, with many looking at the slowed growth in the e-commerce sector.
Amazon’s revenue grew by 27 per cent year over year to $113.08 billion, a slowdown from the 41 per cent year-on-year growth during the second quarter of 2020.
Amazon CFO Brian Olsavsky points out the COVID growth was never sustainable.
“We’re starting to lap that and that’s why you see some of the growth rate coming down,” Olsavsky said in a media call.
Amazon is expecting growth to continue to slow, estimating revenue between $106 billion and $112 billion, growth 10-16 per cent, year-on-year. Wall Street estimates are $119.2 billion.
“Our customers are safe and healthy and ordering from us. And we know that there’ll be more vacations or be more mobility. They’ll be things that probably people shied away from last year and that’s all good,” Olsavsky said.
“But it does tend to lead them to do other things besides shop. So we’re just adjusting our run rates in the period that we see that happening.”