Amazon CEO Andy Jassy: Consumers Likely to Pay Cost of Tariffs

Core Insights - Amazon's third-party sellers are expected to pass tariff costs onto consumers due to insufficient margins to absorb these costs [1] - The company is actively working to keep prices low through strategic inventory purchases and renegotiating terms with vendors [2] - Despite the new tariffs, there has been no significant change in consumer behavior, with some customers potentially buying ahead to avoid future costs [2] Supply Chain and Business Operations - Amazon's AWS cloud computing business has diversified its supply chain significantly over the past five years, sourcing components globally [3] - The high demand for AWS and AI services continues to drive growth, with no signs of demand attenuation [3] Market Impact and Seller Responses - Following the announcement of new tariffs, Amazon has canceled orders from multiple vendors in China and other Asian countries, impacting a significant portion of its sellers [4] - Approximately half of Amazon's merchants are based in China, facing decisions to either increase prices or exit the platform due to the tariffs [4] - Among sellers interviewed, three indicated plans to raise prices for exports to the U.S., while two considered leaving the market [5]