Online retailer Amazon.com Inc called this holiday season its “best ever,” saying on Friday that it saw a 17 percent increase in orders on its busiest day — a rare piece of good news in a season that has been far from merry for most retailers, including online businesses.
Amazon customers ordered more than 6.3 million items on Dec. 15, compared with roughly 5.4 million on its peak day last year, the company said. It shipped more than 5.6 million products on its best day, a 44 percent surge over last year, when it shipped about 3.9 million on its busiest day.
Amazon’s best-sellers included the Nintendo Wii game console, Samsung’s 52-inch LCD HDTV and Apple Inc’s iPod touch.
PHOTO: AP
Analysts agreed Amazon’s report was good news for the online shopping giant, but they were divided over whether the results indicate strength in online commerce in general.
Forrester Research analyst Sucharita Mulpuru said Amazon’s experience shows the current economy is favoring discount retailers, both online and on main street.
“The Amazon story doesn’t surprise me because Amazon has always traditionally been a leader on price and they’re one of the first places consumers go when they’re looking for things online,” Mulpuru said. “In many ways they’re like the Wal-Mart of the online world.”
Holiday sales typically account for 30 percent to 50 percent of a retailer’s annual total, but rising unemployment, home foreclosures, the stock market decline and other economic worries led many shoppers to slash their shopping budgets this year.
SpendingPulse — a division of MasterCard Advisors — said its preliminary data showed that online sales fell 2.3 percent compared with the last year’s holiday season, while retail sales overall fell between 5.5 percent and 8 percent, including sales of cars and gasoline. The decline was between 2 percent and 4 percent when auto and gas sales were excluded.
Online shopping may have gotten a boost from winter storms during last two weeks before Christmas, that made travel to brick-and-mortar stores more difficult.
And, although Amazon’s orders rose, the company didn’t say whether orders were, on average, worth more or less than last year.
Spokeswoman Sally Fouts said the company would release revenue results in its fourth-quarter earnings report, due in about a month.
But she said this was Amazon’s “best season ever.”
Orders to Amazon on the peak day of its holiday season have jumped in the double-digit percentage range for at least the past 5 years, data released by the Seattle, Washington-based company since 2002 showed. Last year, Amazon’s orders spiked 35 percent to 5.4 million at their peak, from 4 million in 2006.
Stifel Nicolaus & Co analyst Scott Devitt said online retailers’ sales tend to grow much faster than those of brick-and-mortar retailers, but he said that difference narrowed this year. That’s in part because shoppers tend to go to stores for necessities and online for discretionary purchases, he said. And in an economic downturn, consumers focus on their most-needed purchases and cut back on more frivolous items.
Devitt said Amazon benefited from a vast infrastructure that allows for faster, more reliable shipping than most of its online peers offer. He called Amazon’s announcement an “extremely positive data point” and said the company was “uniquely positioned to do well in an environment like this.”
That environment has left many retailers in a tough position. NPD Group senior retail analyst Marshal Cohen said they would be forced in coming weeks to take still more drastic measures to drive sales and raise whatever cash flow they can.
In Friday afternoon trading, Amazon’s shares gained US$0.25 to US$51.69.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by