An Amazon Turnaround

By Douglas A. McIntyre Published Jun 22, 10:30AM EDT

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An Amazon Turnaround — © MicroStockHub / Getty Images

Amazon’s stock has taken a nosedive unlike any in the past several years. Year to date, it is down 34%.

The cause of this is that its huge e-commerce business has been crippled by high costs. It has continued to keep labor costs down, and some would say this is at the expense of low-paid workers. It also overbuilt its distribution system, in particular its warehouse network.

Lost, to some extent, is that Amazon continues to be the global leader in cloud computing. It remains one of the foundations of global tech sales growth. The industry has become crowded with start-ups. Yet, these seem to have taken business from one another and weak players like IBM. Amazon and Microsoft continue to have the best market shares.
[nativounit]
Amazon will close many of its warehouses and right-size its e-commerce business. The company has a reputation of nimbleness, and that has not been dented. Margins on e-commerces sales should be back to normal levels by the holiday season. Amazon’s shares have sold off too much.
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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.