Amazon stock gives up pandemic gains after almost 50% plunge this yr

Amazon‘s stock price has lost all of its pandemic-fueled gains, falling back to where it was trading when Covid-19 began shutting down the U.S. economy.

On Monday, the e-retailer’s shares dropped 3.4% to $84.92, the bottom close since March 16, 2020.

Amazon has fallen sharply this yr amid a broader tech selloff tied to soaring inflation, a worsening economy and rising rates of interest. For the primary time in nearly twenty years, the tech-heavy Nasdaq Composite is about to lose to the S&P 500 in consecutive years. Trillions of dollars have been wiped from tech stocks.

Shares of Amazon have tumbled 49% in 2022 and are on pace for his or her worst yr for the reason that dot-com crash of 2000, when the corporate lost 80% of its value. Among the many highest-valued tech corporations, Meta has had the worst yr, down 66%, followed by Tesla at 57% after which Amazon.

It is a marked reversal from 2020, when Amazon stock rallied amid unprecedented online demand. Amazon saw a rush of orders from consumers at the peak of the pandemic, as many avoided trips to physical stores and turned to the online for essential and non-essential goods.

Last yr, the story began to vary, as e-commerce corporations reckoned with tough year-over-year comparisons and the economy began to reopen, leading many individuals to return to physical stores. By early 2022, higher costs tied to inflation, supply chain constraints and the war in Ukraine generated further pressure on Amazon and other tech corporations.

For Amazon, the challenges go deeper. It is also contending with slowing growth in its core retail business, and the corporate has been forced to reduce after it historic expansion in the course of the pandemic.

CEO Andy Jassy has launched into a wide-ranging review of the corporate’s expenses, leading to some programs being shuttered, and a hiring freeze across its corporate workforce. Last month, the corporate began shedding hundreds of employees as a part of a wave of job cuts which might be expected to increase into next yr.

The pain is not more likely to let up soon. Amazon spooked investors in October when it projected sales between $140 billion and $148 billion for the present quarter, representing growth of just 2% to eight%. That was far below analysts’ average forecast of $155.15 billion, in accordance with Refinitiv.

WATCH: Amazon CEO Andy Jassy on shifting consumer spending habits