- Amazon CEO Andy Jassy admitted that tariff uncertainty plagued the retailer during the company’s latest earnings call Thursday. Jassy said Amazon has stocked inventory to get ahead of higher costs and has emphasized that third-party sellers should do the same. Amazon posted a robust quarterly earnings report, but lower than expected Q2 guidance caused the company’s stock to slip during after-hours trading.
Even the CEO of the world’s second-largest retailer doesn’t know precisely what’s in store in terms of the impact of President Donald Trump’s trade policy.
“You know, it’s hard to tell what’s going to happen with tariffs right now,” Amazon CEO Andy Jassy said on the company’s quarterly earnings call Thursday. “It’s hard to tell where they’re going to settle and when they’re going to settle.”
As Trump’s trade policy has ripped through the stock market, bringing economic uncertainty and concerns about higher prices for consumers, Jassy says Amazon is focussed on the short-, medium-, and long-term plans to keep prices down.
“How do we actually have the broadest possible selection for customers at the lowest possible prices?” Jassy said. “And there’s maybe never been a more important time in recent memory than trying to keep prices low, which we are heads-down and pretty maniacally focused on.”
Jassy emphasized that Amazon is stocking up inventory and “encouraging” its third-party sellers to do the same to mitigate tariff cost increases. Additionally, he touted Amazon’s “broad selection” compared to other retailers to assist budget-conscious consumers find the lowest prices.
“It means that when you’ve got this continuity like we may potentially have, you’re better able to help customers find what they want, no matter what those trends are,” Jassy said.
“It could be as simple, by the way, as just favoring other brands that maybe people didn’t know about before, but where they have a more favorable price equation for customers,” he added.
Earlier this week, rumors circled that Amazon was planning to itemize the added cost of tariffs to its prices. Amazon quickly denied there was such a plan in place, but the Trump administration took offense. White House press secretary Karoline Leavitt told Axios the plans were a “hostile and political act.”
Additionally, the president called Amazon founder Jeff Bezos. Later in the day Trump said Bezos “solved the problem very quickly.”
“The team that runs our ultra-low-cost Amazon Haul store considered the idea of listing import charges on certain products,” an Amazon spokesperson said in a statement. “This was never approved and is not going to happen.”
Amazon’s first-quarter earnings beat expectations, causing a pre-earning rally of more than 3%, its highest level since April 9. But a soft Q2 guidance sparked an after-hours selloff of as much as 4.84%.
The Seattle-based company earned $155.6 billion in revenue and earnings per share (EPS) of $1.59 , while beating consensus analyst estimates of $155.1 billion in revenue and $1.37 in EPS, according to FactSet data obtained by Forbes.
Amazon’s AI-focused AWS cloud sector saw annual sales growth increase to $29.3 billion, up 18%, on pace with internal forecasts of $29.4 billion in sales growth.
Issuing a less-than-expected guidance for Q2, Amazon expects sales between $159 billion to $164 billion and operating income between $13 billion and $17.5 billion in Q2. The company had estimated sales of $161.2 billion and $17.6 billion in operating profit.
Additionally, Wednesday Amazon announced plans to invest $4 billion to expand its delivery network into rural America. The initiative will create more than 100,000 jobs and expand Amazon’s footprint to “an area the size of Alaska, California, and Texas combined,” senior vice president Udit Madan said in a statement.
“We’re closely monitoring the macroeconomic environment, including the impact of tariffs,” chief financial officer Brian Olsavsly said. “We’re planning for various outcomes, and we’ve taken a number of actions to protect the consumer experience.”