Amazon Shares Decline Amid Concerns Over Prime Day Sales

Amazon traded lower amid concerns that Prime Day sales could disappoint, with sales down 14% YoY in the first four hours compared to a year ago. The decline may be due to factors such as increased competition, economic uncertainty, and changes in consumer behavior. As a result, Amazon's stock price fell.

Amazon's stock traded lower on July 2, 2025, amid concerns that Prime Day sales could fall short of expectations. The company's stock price dropped as early sales data indicated a 14% year-over-year decline in the first four hours compared to the same period last year [1]. Several factors, including increased competition, economic uncertainty, and changes in consumer behavior, are believed to be contributing to this decline.

Prime Day, Amazon's annual sales event, is scheduled to run from July 8 to July 11, offering a longer duration than last year's event [1]. Despite the extended period, early sales data suggests that consumers are being more cautious with their spending. Adobe's forecast predicts a record $23.8 billion in sales, a 28.4% increase from the previous year, but the initial sales figures indicate a slower start [1].

Economic uncertainty and tariffs are significant factors influencing consumer behavior. A survey by Smarty found that 32% of shoppers are being more selective about purchases due to budget constraints, while 25% are planning to buy more items to avoid future price increases [1]. Another survey by Ankeneo revealed that 57% of consumers are being impacted by tariffs, with 25% planning to skip or buy less during Prime Day [1].

Some third-party sellers are opting out of Prime Day due to the pressures of tariffs. Smaller sellers are particularly affected, as they have higher exposure to tariff costs [1]. For example, Bogg Bag, a China-made tote bag company, decided to skip Prime Day this year to retain unsold inventory and manage profit margins [1].

Despite the challenges, Amazon is expected to offer numerous deals during Prime Day. Lauren Beitelspacher, a professor at Babson College, believes that the event will be successful, especially given the current price-conscious environment driven by tariffs [1].

References:
[1] https://www.usatoday.com/story/money/2025/07/08/amazon-prime-day-deals-tariffs/84490571007/