Amazon Stock Plunges 3.86% on New Tariff Fears

On April 7, 2025, Amazon.com's stock dropped by 3.86% in pre-market trading.

Recent developments have raised concerns among Amazon investors regarding the potential financial impact of new tariff policies announced by the U.S. government. The new tariffs, which include a weighted average tax rate of 18.2% on goods from multiple countries, could significantly affect Amazon's first-party (1P) e-commerce business. Analysts estimate that the increased costs could lead to a 15-20% rise in Amazon's U.S. product costs and a 9-12% increase in global product costs.

Despite these challenges, Amazon has several strategies to mitigate the impact. The company can negotiate with suppliers to reduce cost increases, adjust product structures to favor lower-tariff or domestically produced goods, and raise prices to offset some of the cost increases. Historically, Amazon has shown resilience during previous tariff periods, maintaining stable profit margins.

Additionally, Amazon has been actively expanding its global presence. The company recently signed a new cooperation agreement with the Zhejiang Provincial Department of Commerce, launching the "Zhejiang Industrial Belt Amazon Cross-Border E-commerce Empowerment Plan." This initiative aims to support the integration of industrial belts with cross-border e-commerce, cultivate cross-border e-commerce brands, and develop new growth points in cross-border e-commerce.