Amazon Prime Day is coming early this year. Here’s why Wall Street is paying attention
Amazon’s four-day Prime Day event this week may reveal something more important to the e-commerce giant than a big sales number. Wall Street will be watching to see if Amazon can solidify itself as a go-to place for shoppers to find everyday essentials at a time when inflation-weary shoppers are focused on value. Prime Day begins at 12:01 am PT on Tuesday (or 3:01 am ET) and runs through June 26 at 11:59 pm PT on Friday (or 2:59 am ET on Saturday). In addition to tons of deals in over 35 categories, Amazon is putting an extra boost in its underserved grocery category — offering 10% off purchases for Prime members. During the online shopping event, media and trade research firm Emarketer estimates that Amazon’s US Prime Day sales will increase 7.1% year-over-year to $15.6 billion. That number will be more than 60% of all retail sales in the United States during those four days. Not to be outdone, Walmart, Target, Best Buy, and other retailers are launching competing promotions. This is the second year of the four-day Prime Day format. The event started as one day in 2015, moved to two days in 2019, and went to four days in 2025. He also traveled earlier and earlier in recent years to capture many of the cool summer stores, where the event was first created. By pressing the timeline for Prime Day earlier this year, Sky Canaves, an analyst at Emarketer, pointed out that the move is “a way to test whether Amazon can increase the types of purchases that consumers make during Prime Day.” Amazon tends to focus on selling in categories it dominates, such as consumer electronics and other big-ticket items. But in recent years, with rising inflation sending consumer sentiment to historic lows, there has been a “reported shift in the demographics of consumers,” Canaves explained. Inflation, as measured by the consumer price index, rose to 4.2% year-on-year growth in May, the highest rate in three years. It was largely driven by the high energy costs tied to the Iran war. (At the time, Jim Cramer was on record saying that oil prices should drop when the war ends. That’s what’s happening now, but it won’t show up in the economic numbers for a while.) Higher prices put more pressure on household budgets and increase consumers’ desire for discounts and value. There was a lot more “budget information,” Canaves said. Prime Day shoppers have fallen in love with deals on daily essentials, groceries, and personal care and beauty products. It’s these “smaller ticket items that they’ll use Prime Day to shop for,” says an Emarketer analyst. It’s a trend supported by recent consumer surveys. According to an April survey conducted by marketing platform Omnisend, 53% of respondents cited steep discounts as their primary motivation for Prime Day shopping. The survey found that 55% of US consumers plan to participate this year, up from 45% last year, while 66% expect to spend the same or more than they did during the previous event. “A lot of people use Prime Day strategically,” said Marty Bauer, e-commerce specialist at Omnisend. “Their plan is to stock up on everyday essentials while there are discounts available.” Canaves said Prime Day’s growing focus on household staples coincides with Amazon’s increased investment in fresh and perishable grocery items, categories that have gained strength as Amazon expands same-day delivery capabilities. Unlike electronics purchases, groceries and essentials are a “big hook” for shoppers, Canaves said, adding that such items encourage repeat purchases. Amazon already has a strong presence in those categories. Canaves noted that other top sellers in recent days have included energy drinks, Liquid IV hydration products, and accessories, alongside Amazon devices. Over the years, Prime Day has become less about adding new members and more about increasing the value existing members receive from their Prime subscription, Canaves said. That’s because it’s a good problem to have. Emarketer estimates that there are currently approximately 190 million users in the US, representing over 86% of all US online consumers. “Once you get to that point, it’s very difficult to grow because the market is almost saturated with members — almost everyone has access to a Prime account,” Canaves said. Amazon is targeting younger shoppers with discounted membership programs, cash-back offers, and promotions aimed at college and back-to-school shoppers. According to Emarketer, GenZ and Millennial Prime members are more excited than older generations about event travel from July to June and tend to be Day One revenue drivers. This year’s Big Day will also be Amazon’s chance to highlight Alexa Shopping, a personalized AI assistant that can create personalized deals and product recommendations based on a user’s shopping history and preferences. The tool is available to customers on the shopping app and website. Bank of America called Alexa Shopping “an essential tool for finding and tracking deals during the Big Day,” in a June 18 preview of the online shopping event. Analysts believe that Alexa will be “a key tool in securing Amazon’s direct traffic, as well as enabling higher conversion rates and driving more revenue to the platform.” They predict that Alexa could generate more than $200 billion in 2035 and $20 billion in incremental retail revenue. The bank has a buy rating on Amazon and a $310 price target. Bottomline Prime Day is Amazon’s strategic event to strengthen customer loyalty, and even more so today, to drive repeat purchases in high-frequency categories such as groceries and daily essentials. Rather than a short-term boost in sales, the goal is for Amazon to gain deeper customer engagement in the category of essentials. The stock has been underperforming, delivering gains of 1.7% year to date, in a market that appears to be unpopular with megacaps spending billions of dollars on building their AI infrastructure. The IS&P 500 is up 9% in 2026. Let’s hope Amazon doesn’t raise equity, like Alphabet did with its $85 billion stock sale to fund its AI development. At 27 times forward earnings, Jim said he was “very concerned” about Amazon’s valuation. However, at the same time, there are reasons to remain optimistic. Its cloud business, Amazon Web Services (AWS), has seen rapid growth with impressive margins. If oil prices continue to fall, that should boost its retail business, given that higher fuel costs are a major input cost for the company and a barrier to consumers. We have a 1-buy rating and a $300 price target on Amazon stock. 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