Amazon’s online sales drop to 42% of business as third-party units hit new high – GeekWire

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Amazon wants to grow for the long term in areas such as healthcare, self-driving taxis and household robots, but two data points from its latest results reveal a more fundamental transformation already underway in its core business.

1. The company’s proprietary online store sales of $50.9 billion in the second quarter were less than 42% of its overall net sales of $121.2 billion.

That’s a new low percentage, according to data tracked by GeekWire.

Five years ago, Amazon’s online store sales accounted for about 60% of its overall sales.

Online store sales fell 4% last quarter from $53.2 billion a year ago, but the long-term change is more the result of faster growth in other business areas from Amazon, including Amazon Web Services and the services of third-party sellers. Speaking of what…

2. Third-party sellers were responsible for 57% of units sold on Amazon in Q2.

That’s a record, Brian Olsavsky, Amazon’s chief financial officer, said in a call with reporters after the earnings report Thursday afternoon.

In a related trend, Amazon’s revenue from third-party seller services topped $27 billion, a record for a non-holiday quarter. The Third-Party Seller Service includes the sales commissions that Amazon collects from third-party sellers and the fees that the company collects for packaging and shipping its orders.

Taking these two trends together – looking at the black and blue lines in the chart above, and factoring in Prime’s expansion and realization beyond Amazon.com – it’s not hard to imagine a world in which Amazon makes more money by providing services to third-party sellers than it sells its products directly to consumers.

Check out our revenue coverage of Amazon in the second quarter of 2022 to learn more.

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