Amazon.com Inc., shocking Wall Street, projected the slowest holiday-quarter growth in the company’s history, sending the shares tumbling about 11% Friday morning.
The Seattle-based company, which reaped record profits during the pandemic, said sales during the current period will rise just 2% to 8% as shoppers reduce their spending in the face of economic uncertainty. Either figure would be the slowest increase ever for Amazon’s “Peak” season, which usually finds warehouse employees rushing to get orders out on time. Amazon's sales rose 9% to $137.4 in the fourth quarter of 2021.
And the e-commerce giant’s other businesses aren’t riding to the rescue. Amazon Web Services, the cloud-computing division, and the advertising unit each reported muted third-quarter revenue growth by their lofty standards.
“We’re taking actions to tighten our belt,” Chief Financial Officer Brian Olsavsky said Thursday on a call with journalists after the results were released. Olsavsky said Amazon would pause hiring in some businesses and wind down products and services in areas where the company determines its money would be better spent elsewhere.
The report, and subsequent share decline, pushed Amazon’s market value below $1 trillion dollars. The e-commerce giant joins a long list of U.S. companies to see their market values crumble in this year’s bear market.