Amazon’s Prime Day plus earnings season put consumers in the spotlight
The U.S. consumer could soon jump to the front of the line of Wall Street’s worries, with Amazon ‘s Prime Day sales and companies’ second-quarter corporate earnings season delivering plenty of data to sort through. The dominant e-commerce platform’s annual sale began on Tuesday. Bank of America analyst Justin Post estimated that this Prime Day could generate $21.4 billion in gross merchandise sales volume across all 26 countries that are participating. That is up about 60% year over year, according to Post, but the 2025 Prime Day event will last four days — twice as long as the 2024 version. That extended window means that comparing year-over-year data could be difficult, especially early this week, but sales coming in below estimates could set off alarm bells. Shares of Amazon were down nearly 2% on Tuesday. AMZN 1D mountain Amazon’s stock was lower on Tuesday. Prime Day is not necessarily a representative test of U.S. consumer spending, but the promotion — and competing sales from rival retailers such as Walmart , Target and Best Buy — comes at a time when that part of the economy may be starting to slow. Consumer spending accounts for some 70% of all U.S. economic activity. Tariff impacts could play a role in any deceleration here, as there is some evidence that consumers pulled forward their spending earlier this year to avoid extra costs. Trade complications aside, other data is showing that wallets are stretched thin. Consumer spending fell slightly in May, according to the Bureau of Economic Analysis , while measures of disposable income were also down year over year. That weakness will be reflected in the second-quarter earnings reports from companies, which begin in earnest next week. Andrew Smith, chief investment strategist at Delos Capital Advisors, said he still sees the U.S. as being in a cyclical bull market, but warned that the second-quarter reports will be “one of the most important earnings seasons we’ve had in a while.” “We’ve seen kind of a slowdown in retail demand. Even if we net out the net immigration aspect, households are not spending as much. So what does that really mean for the economy? We’re going to get a lot of news starting next week,” Smith said. Some of the corporate reports next week that could shine a light on the consumer include those from Pepsico , on July 17, and American Express , on July 18. — CNBC’s Michael Bloom contributed reporting.
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