Amazon CFO cites inflation, energy costs for dip in stock price

Business

(NewsNation) — While the holiday season has not officially begun, the world’s largest online retailer believes sales will be anything but merry, as Amazon is predicting a less-than-stellar shopping season.

While data shows strong consumer spending, ebbing wage growth and third-quarter aggregate earnings estimates raised, Amazon saw a 6.8% drop in its shares.

Amazon’s Chief Financial Officer Brian Olsavsky blamed the dip on inflation and rising energy prices, which, he said, are causing consumers to curtail their spending.

“This is uncharted waters for a lot of consumers’ budgets,” Olsavsky said Thursday.

Of the 11 major sectors of the S&P 500, all but consumer discretionary stocks, weighed down by Amazon shares, ended the session green. Tech shares enjoyed the largest percentage gain.

To help make sense of the retail giant’s economic performance, University of San Diego finance professor Dan Roccato joined NewsNation’s “Rush Hour” to discuss what happened and the implications for the future.

“It’s still Amazon’s world, but they’re not immune to the buzzkill of inflation — the same inflation that you and I are feeling,” Roccato said.

As far as what that means for Amazon consumers, Roccato said it could be a good thing.

“It means consumers are going to get a break,” Roccato said. “The reality is this: We’re going to see sales earlier and we’re going to see discounts a little bit deeper as we get through this last quarter, because they’ve got to move the merchandise because of competitive pressures, consumer stockpiles. etc.,” he said.

Reuters contributed to this story.

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