Stock Market: Amazon's Stock Plunges 30% in 24 Hours

Massive sell-off for Amazon on the stock market. The company founded by billionaire Jeff Bezos has seen its share price erode by more than 30 % within 24 hours. The reason is the company’s underperformance at the end of the first quarter of 2024. More than 200 billion dollars are involved in this development.

A stock market crash valued at 210 billion dollars

The Amazon share has experienced a spectacular fall in the stock market. In the span of one day, it lost more than 30 % of its value. This decline resulted in a loss of about 210 billion dollars.

This loss is not the result of chance. It follows the publication of the company’s quarterly results. The performance was poor, with the company announcing a loss of 3.8 billion dollars for the 1^st quarter.

Amazon’s underperformance at the end of this period is fundamentally unexpected, although well below the forecasts of analysts. According to the company, it would be related to inflationary pressure and persistent constraints in the supply chain.

Andy Jassy, the CEO of Amazon, acknowledged the challenges encountered, stating that the company is focusing on improving its productivity and profitability. However, analysts remain cautious about the future of the firm on the stock market. This is while Amazon Web Services division showed a 37 % increase in the 1^st quarter.

Skepticism about the evolutions of Amazon on the stock market

In the minds of some market experts, the signals are no longer green for Amazon’s stock. Dan Romanoff, a stock analyst at Morningstar, in particular lowered his price target on Amazon shares. Citing concerns about the company’s operating margin as the reason for this turnaround, he is at least cautious about the short-term improvement in the stock’s value foreseeing a persistence of Amazon’s profitability challenges in the coming months.

However, other analysts remain optimistic about Amazon’s long-term prospects. An optimism based on the company’s ability to withstand cost pressures thanks to superior operational efficiency. That is yet to be seen.

It should be noted that Amazon’s stock market rout is far from an isolated case in the tech sector. For instance, Tesla also recorded a 12 % fall in its shares. The trend is similar for the Nasdaq.

Heavily tech-focused, the stock market is also having a difficult period, registering its most considerable monthly decline since October 2008. All seem to be suffering from widespread concerns about slowing growth, rising interest rates, and geopolitical disruptions.