Amazon Shares Skid on Weak Outlook Amid Recession Fears

Amazon is heading into the holiday season talking about cost cuts rather than sales growth. The Wall Street Journal reports that the e-commerce leader is projecting that sales in the current quarter would be far below expectations, sending a new shock wave across the retail sector and offering a stark sign of how shifting economic forces are battering companies that thrived during the pandemic.

Amazon’s sales last quarter rose 15% from a year earlier, while its $2.9 billion net profit marked its first quarterly profit this year but a 9% decline from the year before.

The company also jolted observers with its projection for revenue of $140 billion to $148 billion in the fourth quarter — analysts had expected more than $155 billion. CEO Andy Jassy said Amazon is building “a stronger cost structure for the business moving forward.”

That plan includes cutbacks in the company’s sprawling logistics network.