Without a shadow of a doubt, Amazon (NASDAQ:AMZN) (AMZN) has been one of the best-performing stocks over the past five years, and when the pandemic hit back in 2020, the stock more than doubled in value as shoppers abandoned the high streets in favour of online shopping.
But as the saying goes, what goes up, must come down, and Amazon is no exception. Shares of the online retail and technology giant dropped more than 7% on Friday after the company reported disappointing second-quarter results and gave weak guidance for the current quarter, suggesting recent pandemic-fueled momentum is receding.
The share price is on pace for its worst day since March 12, 2020, when it nose-dived just under 8%.
Amazon has warned investors it will see slower growth in the next two quarters as it gears up for tough year-over-year comparisons to its business during Covid-19 lockdowns.
Investors acknowledged the slower growth would put Amazon shares under pressure in the near term. Still, several analysts said they remain confident that e-commerce businesses as a whole will continue to grow, benefiting Amazon as a result.
At the time of writing, the Amazon (AMZN) share price has made a slight recovery and is now 6.5% down on the day.