Amazon Reaches a Less Desirable Milestone! Bezos in Trouble

Amazon becomes the first trade company to lose US$1 Trillion, which was least expected by Jeff Bezos

As a result of a combination of events this year, including increasing inflation, tightening monetary policy, and dismal financial reports, Amazon is the first publicly traded firm in history to have its market value fall by one trillion dollars. CEO Bezos might have not expected declination in Amazon's stock price.

There is also news that the Amazon robotics team might be laid off completely very soon. The e-commerce and cloud company's shares dropped 4.3%, reducing its market worth from a record close of $1.88 trillion in July 2021 to roughly $879 billion. Amazon and Microsoft Corp were competing head-to-head to surpass the undesirable milestone, with Microsoft Corp. coming in second place after losing $889 billion since its November 2021 peak. Jeff Bezos's The Everything Store made market history when it became the first publicly traded company to lose $1 trillion in market value. Amazon's stock price declines to its lowest.

Fears of a recession have further dimmed the mood in the sector, which has already been hit hard by the year-long punishment of technology and growth companies. This year, the market value of the top five US technology corporations by revenue has decreased by around $4 trillion.

As consumers cut back on their purchasing in the face of economic uncertainty, Amazon predicted the slowest sales increase for a Christmas quarter in the company's history last month. This resulted in its market worth falling below $1 trillion for the first time since the tech stock rally that was sparked by the epidemic more than two years ago.

As consumers returned to their pre-pandemic purchasing patterns, the largest online retailer in the world has spent this year adjusting to a dramatic slowdown in e-commerce growth. Due to declining sales, rising costs, and an increase in borrowing rates, its shares have dropped by approximately 50%. According to information gathered by Bloomberg, co-founder Jeff Bezos' wealth has decreased by about $83 billion to $109 billion since the year began.

These decreases affect more companies than just Amazon and Microsoft. According to reports, the top five U.S. tech businesses lost a combined $4 trillion in worth this year. That is greater than the combined GDPs of Turkey, Argentina, and Switzerland, to put it in context.

Particularly Amazon let down investors this month when third-quarter revenues fell short of estimates. Even worse, the company predicted it would only experience 2-8% year-over-year growth in the fourth quarter. That would be acceptable for a typical business, but Amazon, which was until recently a relentless growth engine, is anything but typical. Amazon, like many other businesses, has had to deal with dwindling e-commerce sales as customers start to trickle back into brick-and-mortar stores less concerned about COVID-19.

After the release of the third quarter results report, CEO Andy Jassy commented, "There is certainly a lot occurring in the macroeconomic climate. "And we'll balance our investments to be more efficient without sacrificing our important long-term, strategic bets," the statement continued.

On the positive side, Amazon has so far avoided the startling layoffs that have affected so many of its peers in the tech industry. That is not to argue that there aren't some causes for alarm. The corporation took action earlier this month to extend a prior hiring freeze to include all of its corporate staff. The main causes of the delay, according to a memo from Amazon Senior Vice President of People Experience and Technology Beth Galetti, are an uncertain economic outlook and an increase in hiring in recent years.

Zooming out, it could be argued that the historic valuation losses reveal as much about the quirks of the contemporary global economy as they do about a single corporation. Apple was the first business to reach a $1 trillion valuation just four years ago. In the years since, Apple has miraculously tripled that valuation for a brief period, and about a dozen other businesses, including Saudi Aramco, Microsoft, Amazon, and Meta, have all surpassed the previously inconceivable sum. Now, in 2022, the more interesting stories are about people who can lose that same amount and still maintain unacceptably high levels of wealth, rather than about companies reaching that trillion-dollar milestone.

Amazon has begun letting go of workers. The Amazon Robotics crew was fired by the Andy Jassy-led corporation, claims an unnamed source who spoke with AIM. A developer on the team, Jamie Zhang, posted yesterday on LinkedIn to express shock at the quick decision. Zhang mentioned that he was building pipelines for continuous integration (CI) and continuous deployment (CD) with the company's AWS division.

In light of the unstable macroeconomic climate and the significant slowdown in the company's core retail business as consumers turn back to shopping in physical stores, Amazon recently announced that it was implementing a hiring freeze.