retail news in context, analysis with attitude

From Bloomberg, a provocative thought:

"What happens when the growth stops?

"Amazon.com Inc. last week disclosed an eyebrow-raising milestone: The world’s largest online retailer sold roughly the same number of goods in the most recent quarter as it did in the same period last year.

"Unit sales - reported in Amazon’s earnings in terms of 'year-over-year growth,' because, historically, all the company did was grow—came in at 0% in its latest report. That is to say, absolutely flat.

"There are some asterisks. The figure doesn’t include sales by Amazon’s cloud-computing division or Whole Foods. It also tallies only the quantity of units sold, not their value. Amazon’s revenue itself rose by 7.3%.

"But for a company that has averaged 30% revenue growth since 2000, the unit sales metric is something of a sorry number. After the report, Amazon’s share price crumbled, and financial analysts re-evaluated their (still overwhelmingly optimistic) takes on the company.

"And lately, a few have been wondering whether the retailer’s recent stumbles might herald the advent of a new era: Peak Amazon."

KC's View:

I do think that one of Amazon's advantages will be that it has effectively spread its bets around … it isn't just dependent on one segment of business to be successful.  But I do think that this is a question that must be on the minds of Amazon's leadership.