Amazon CEO Jeff Bezos loses $9.86B on regulation fears

Markets Insider

Amazon shares slid sharply Monday, after US President Trump tweeted that Amazon causes the US postal service to lose money. "THEY LOSE A FORTUNE, and this will be changed", he wrote.

Amazon also pays local property taxes on its distribution centers as well as on the Whole Foods stores it purchased previous year.

The US Postal Service (USPS) in November reported a decline in annual revenue, hurt by a drop in first-class and marketing mail, offset partly by an increase in package delivery. He also said: "I have stated my concerns with Amazon long before the Election". While we know that Amazon is the biggest e-commerce player, we don't know exactly how much of the $7 billion comes from Amazon, because the details of the postal service's deals with private shippers are considered proprietary and not made public. "Potential "new economy" monopolies will require close monitoring", Rubio said. Google and Facebook (FB - Free Report) now hog the majority of this market, but the analyst expects Amazon could increase its share to $8 billion in North America and $20 billion globally as soon as 2020. In 1.38pm trading, the Standard & Poor's 500 Index plunged 3.2 percent. The shares were sold at an average price of $1,577.85, for a total value of $788,925.00.

White House spokeswoman Lindsay Walters said on Thursday that while the president was displeased with the e-commerce giant, and particularly instances where third-party sellers on the site didn't collect sales tax, there were no administrative actions planned against Amazon "at this time".

President Trump has reportedly nursed an obsession with Amazon chief Jeff Bezos.

According to the Citigroup report, the irrational pricing keeps the USPS unprofitable and, "Amazon is benefitting from discounted rates and has greater flexibility in its system". However, this week the president has been particularly focused on Amazon. Which is what led a lot of the media to believe that there was some truth in Trump's tweets.

How exactly the president could do that is uncertain, though beyond the Post Office deal Trump could push for ending governments contracts such as one for cloud computing with the Department of Defense. How the USPS fares in its business relationship with Amazon is not fully known.

Amazon does receive a discount from the Postal Service, though the details of that arrangement have not been disclosed. If the P.O. "increased its parcel rates, Amazon's shipping costs would rise by $2.6 Billion". If Trump expands sales tax legislation in a bid to harm Amazon, the move is widely expected to boost the company's never-ending growth. The USPS charges some of the lowest stamp prices in the world.

"Amazon is very actively seeking out tax incentives for warehouses, data centers, and now for its second headquarters as well, which is not entirely unusual", Davis said.

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