Amazon Sales Down

last updated on

Amazon Sales Down

Amazon Sales Decline By 3%

Amazon reported its first-ever quarterly loss due to a decline in sales volume along with the falling share value of Rivian (an electric car company). The sales on Amazon slipped by around 3% during the first quarter due to the fall of the pandemic era boom.

During the pandemic, a massive rise in online shopping was witnessed, which also helped the firms such as Amazon. Now that the situation has normalized and things are almost back to normal, it was only natural for the Amazon sales figure to go back to normal as well.

In other news, the tech giant Apple also hinted that its sales could face a loss of $8 billion due to the current lockdown situation in China.

Both companies (Amazon & Apple) have cited the Russian-Ukraine war and supply chain issues behind this loss in sales.

Advertising & Cloud Computing Remained Strong

Despite the drop in sales numbers, Amazon posted strong growth in other businesses such as advertising and cloud computing.

In fact, around a $7.6 billion loss can be attributed to Amazon's stake in the electric car maker Rivian. In 2019, Amazon secured a 20% stake in Rivian and had plans to develop an electric delivery fleet. However, the share price of Rivian has almost lost more than 50% of its value ever since then and is also struggling to increase production.

Looking ahead, experts believe that Amazon's sales growth will be around 3% in the coming months, which is a lot slower than the double-digit growth enjoyed by Amazon during the pandemic.

According to Andy Jassy (Cheif Executive Amazon), the pandemic and the Ukraine war have brought challenges and usual growth. He also added that Amazon is also facing supply chain pressures and ongoing inflation, which further intensified the problem.

Experts believe that the Amazon situation will improve as a major portion of the loss can be attributed to Rivian. Although sales were affected as well, Amazon will somehow manage to increase its profits from other businesses.

Trending Stories