Amazon's Prime Day sale has started with reduced demand. How will it affect the stock?

Demand during the first hours of Amazon's Prime Day sale was nearly 14% lower compared to the start of the promotion last year. Analysts predicted that Prime Day in 2025 would be the biggest ever: they expected the sale to help Amazon strengthen its competitive position and increase revenue from both commerce and advertising and subscriptions. Amazon shares have appreciated an average of 3.3% in the past after Prime Day.

Sales in the first four hours of Amazon Prime Day were nearly 14% lower than the same period last year, reported Bloomberg, citing data from Momentum Commerce. It manages sales of 50 brands on the marketplace, including Crocs slippers and Beats headphones, and generates about $7 billion in revenue there, making its observations statistically significant, the agency explained.

It is difficult to compare the figures with 2024: this year the sale lasts twice as long as last year. However, the first hours of Prime Day are still considered an important indicator of its effectiveness, Bloomberg noted. This year, shoppers may have put off purchases in hopes of bo bigger discounts as the promotion progresses, the agency suggested.

Amazon did not respond to Bloomberg's request for comment on the Momentum Commerce data. Earlier, a company spokesman said Amazon works with a wide network of partners and helps them adapt to changing conditions while keeping prices low and assortment diverse.

Even before the sale began, some sellers decided not to participate in the action because of the duties imposed by U.S. President Donald Trump, which raised the prices of many goods imported from China and other countries. Both sellers and analysts are closely watching the results of Prime Day, considering them as an indicator of the state of the economy and consumer confidence, Bloomberg writes.

"Summer Prime Day 2025 could be the biggest in history, with the potential to break sales records, strengthen the company's competitive position and increase both retail and advertising revenue," wrote Tigress Financial Intelligence market strategist Ivan Feinseth, who was quoted by Barron's.

Amazon's total gross merchandise value (gross merchandise value) for the expanded Prime Day sale across all 26 participating marketplaces could reach $21.4 billion: that's 60% more than last year (but the sale was shorter then), noted Bank of America Securities analyst Justin Post as quoted by CNBC. If sales come in below forecasts, that would be a red flag, he warned.

Prime Day is not just a powerful sales driver, but an important tool for Amazon's subscription growth, Barron's wrote, citing Jefferies analyst Brent Till. In 2024, a record number of users signed up for a Prime subscription three weeks before a sale - that's millions of new members worldwide, he said. Amazon Prime subscriptions remain one of the key drivers of customer retention, Till emphasized.

In addition, Amazon shows historically rise, albeit modestly, after the end of Prime Day: according to Dow Jones Market Data, on average, the securities added 1.11% during the week after the selloff and 3.29% during the month, Barron's added.

According to an estimate by Adobe Analytics, total online sales in the U.S. will reach a record $23.8 billion between July 8 and July 11 - up 28.4% from last year. That's the equivalent of two Black Fridays: in 2024, the sale brought in $10.8 billion, according to Adobe. According to an eMarketer forecast cited by Bloomberg, Americans will spend $17.2 billion online, with 75% of that amount coming from Amazon.

"In our view, this event represents an opportunity for consumers to take advantage of discounts before prices inevitably rise in the second half of 2025," CNBC quoted Monness Crespi Hardt analyst Brian White as saying, pointing to a possible increase in U.S. duties on imported goods. 

Adobe Analytics also expects a "historically high" level of discounts at all major retailers - from 10% to 24%. Such offers should encourage consumers to buy more expensive goods, which they could previously refuse, the analysts believe. Especially favorable offers are expected on clothing, electronics, TVs and home appliances, Barron's reports.

According to Kristin McGrath, senior editor of The Krazy Coupon Lady website, the most notable discounts this year are Apple's: AirPods 4 headphones can be purchased for $89, which is cheaper than on Black Friday, Bloomberg writes. Meanwhile, Amazon devices, such as the Echo speakers, did not receive big discounts. McGrath also noted that the main price battle between Amazon, Walmart and Target is now in the convenience category, including snacks for school lunches. Retailers are emphasizing discounts on basic items over tech, she said.

Amazon launched Prime Day in 2015 to attract new subscribers: for $139 a year, users get discounts on shipping, access to Prime Video streaming and other perks. The promotion helps the company strengthen ties with customers ahead of the holiday season, Bloomberg writes. According to Consumer Intelligence Research Partners, by March 2025, the number of Amazon Prime subscribers in the U.S. has grown to 196 million people - a 9% increase from a year ago.

This article was AI-translated and verified by a human editor