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Amazon's market value falls below $1 trillion, shares have fallen for five straight days
Amazon has withdrawn from the trillion dollar club.
Shares in the electronics retailer fell 5.9% on Tuesday, their fifth straight day of losses, to close at their lowest level since April 2020. The sell-off wiped out nearly all of the stock's gains during the pandemic.
This is investors continuing to punish the company for last week's disappointing fourth-quarter forecast. Amazon said revenue for the holiday season would rise 2% to 8% from a year earlier, but well below analysts' expectations. Sales at Amazon Web Services, the cloud-computing unit, also fell short of expectations.
This is the first time since April 2020 that Amazon's market cap has fallen below $1 trillion. The stock has plunged 42% in 2021 and is on track for its worst year since 2008, when it fell 45%. The only year worse than 2008 was during the dot-com bubble burst in 2000, when the company lost 80% of its market value.
Like other big tech companies, Amazon has struggled this year due to a sluggish economy, soaring inflation and rising interest rates. On top of that, Amazon has been forced to scale back after expanding significantly during the Covid-19 pandemic as consumers now return to patronizing stores.
Amazon is the second-worst performer among the big tech groups this year, behind Facebook parent Meta, which plunged 72%. Last week, Meta told investors that fourth-quarter revenue could fall for the third straight quarter.
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