Amazon Stock Drags Down Shopify
Amazon’s disappointing earnings reports dragged shares of Wayfair, Shopify, and eBay lower Tuesday morning. Retail e-commerce stocks were tumbling Friday as Amazon’s weaker-than-expected first-quarter results signaled a slowdown in the tech giant’s online store business.
Wayfair, Shopify and eBay stocks have been dragged lower by Amazon’s sales disappointment. The e-commerce giant reported revenue of $52.9 billion in its first quarterly report, missing estimates of $53.72 billion. Investors had expected more from Amazon after it announced that it would invest billions into creating its own branded fashion lines and add 1 million U.S. square feet to its fulfillment centers, even though the company continues to grow revenue at an impressive rate of 35%.
Amazon’s most recent earnings report shows that Amazon is still a major player in the ecommerce market. The company’s online sales fell below Wall Street’s consensus of $51.9 billion. The company is projecting total net sales of $116 billion to $121 billion for Q2, largely in-line with expectations.
Shopify Stock and Wayfair Stock are down more than 10% in early trading Friday after Amazon.com's sales growth fell short of expectations. Shopify stock is down 6.28% during the pre-market session, which is the worst performer on the index this morning. Revenue for the second quarter was $957 million, up 42% year-over-year and above the Thomson Reuters consensus estimate of $940 million. Ecommerce revenue grew 45%, while Shopify Plus customers increased to over 18,000 from 11,100 a year earlier.
Shopify is the premier multi-channel cloud-based commerce platform for small and medium-sized businesses. With the Shopify platform, you can easily launch your own online store to sell physical products, digital products like videos and music, or services to customers around the world.
While Amazon’s sales numbers were weaker than expected, investors are still interested in the company's next move. While it may be a long shot for Amazon (AMZN) to buy Shopify (Ticker: SHOP), it is important for shareholders to understand what this deal would mean for their investment.
Amazon stock tumbles on earnings loss