SEATTLE — Amazon reported strong sales for its fiscal quarter and said its Prime Day sale last month was the biggest shopping event in the company’s history, topping its combined sales for last year’s Black Friday and Cyber Monday.
At the same time, the company faces the threat of increased regulatory scrutiny.
The Department of Justice on July 24 announced an investigation into a number of big technology companies, including Amazon, Google, Apple and Facebook. The Justice Department’s antitrust division is reviewing whether the companies are stifling competition in ways that have harmed consumers.
“Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands,” assistant attorney general Makan Delrahim of the antitrust division said in a statement announcing the move. “The Department’s antitrust review will explore these important issues.”
Treasury Secretary Steven Mnuchin supported the idea of an investigation during an interview on CNBC’s “Squawk Box” television show, stating that Amazon has “destroyed the retail industry across the United States, so there’s no question they’ve limited competition.”
Not everyone agrees an actual retail apocalypse is under way, but it is clear that online retailers, led by Amazon, have sparked a revolution in the industry.
And with its Prime Day two-day sales event, Amazon has created a new shopping occasion in the middle of summer. The company says this year’s event was a big hit, with Prime members buying 175 million items during the event. Amazon did not report its actual sales, but noted that the two days of the sales event were also the biggest days ever for people signing up for Prime memberships. Prime Day was also the biggest event ever in terms of sales of Amazon devices, including the Echo Dot, Fire TV Stick with Alexa Voice Remote and Fire TV Stick 4K with Alexa Voice Remote.
Membership sign-ups and Amazon device sales are significant because they help drive future sales for the company.
Amazon, which launched its Prime Day sales event five years ago, no longer has the shopping holiday to itself. Target Corp. and Walmart are among the retailers that offered sales events of their own to coincide with Prime Day, promising big savings with “no membership required.”
Target’s Deal Days event, also held on July 15 and July 16, offered hundreds of thousands of deals on products at Target.com.
According CommerceIQ, more than 250 retailers had deals planned to coincide with this year’s Amazon event.
For many retailers the efforts have paid off. Nielsen noted that Target more than tripled its consumer packaged goods sales on Prime Day last year, compared with an average two-day span throughout the year. And Target says that last year’s one-day sales event was one of its biggest days of the year for online sales.
A little more than a week after its Prime Day event, Amazon reported results for its second fiscal quarter ended June 30. Sales advanced 20% over the prior-year quarter, to $63.4 billion. Net earnings, meanwhile, rose to $2.6 billion, or $5.22 per diluted share, compared with net income of $2.5 billion, or $5.07 per diluted share, in the second quarter of 2018.