Analysts Discuss Amazon’s ‘Biggest Ever’ Prime Day
2022.07.15 13:59
Analysts Discuss Amazon’s (AMZN) ‘Biggest Ever’ Prime Day
By Senad Karaahmetovic
Amazon (NASDAQ:AMZN) announced this week that its Prime Day generated the sale of over 300 million items worldwide – marking the biggest Prime Day ever. The e-commerce giant claims its Prime members saved as much as $1.7 billion during the two-day event.
“Prime Day is a celebration of our Prime members, who look forward to this event every year, and we’re thrilled to have delivered incredible savings to them once again,” said Doug Herrington, CEO of Amazon Worldwide Stores. “This special event is made possible because of the support of our employees, vendors, and sellers, and I want to give a big thank you to all of them for making this a Prime Day to remember.”
U.S. online sales soared 8.5% from last year to nearly $12 billion. For Evercore ISI analyst Mark Mahaney, the company delivered an “impressive” 20% unit growth.
Mahaney projects that Amazon generated about $8.2 billion in GMV and $4.4 billion in revenue from the event, which accounts for 3-4% of Evercore’s Q3 revenue projection.
“We would describe these results as modestly better than we would have assumed but we continue to see some downside to FY22 Street estimates given the seasonality & scale of this business and a tough macro environment,” Mahaney told clients in a note.
Morgan Stanley analyst Brian Nowak estimates $4.6 billion in generated revenues, above his prior expectations. The Prime Day performance gives Nowak “increased confidence in the strength of the Prime consumer/potential for revenue reacceleration in 3Q22.”
Finally, Barclays analyst Ross Sandler sees a “decent chance for AMZN to print a “better than feared” 3Q guide and we would add selectively into the print.”
“Europe seems like the weakest consumer region (WW), and we think AMZN will do better than Zalando’s implied 8% y/y for 2H22; hence, if most geos are in the low double-digit GMV growth range and prime day adds a tad to 3Q, we may have positive surprise. Expectations on OI are about as bad as we’ve ever heard from buyside conversations, but chances of consensus accurately modelling a scenario with declining retail capex and fulfilment headcount against double-digit GMV growth seem low to us. AMZN is going to have to mark down its RIVN stake once again (another $4B-ish), which may add noise to the EPS line, but investors likely look past it,” Sandler explained in a note.
