Amazon Prime Day arrives earlier this year. Here’s why Wall Street is watching closely
Amazon’s four-day Prime Day event this week could reveal something more important for the e-commerce giant than a big sales figure. Wall Street will be watching to see whether Amazon can further cement itself as the go-to place for consumers for daily needs at a time when inflation-weary shoppers are focusing on value. Prime Day begins at 12:01 a.m. PT (or 3:01 a.m. ET) on Tuesday and continues until 11:59 p.m. PT on Friday, June 26 (or 2:59 a.m. ET on Saturday). In addition to tons of deals across more than 35 categories, Amazon is applying an extra incentive to the grocery category it has under-penetrated; It offers an additional 10% discount on products for Prime members. Media and commerce research firm Emarketer predicts Amazon’s U.S. Prime Day sales will rise 7.1% year over year to $15.6 billion during the online shopping event. This figure would account for more than 60% of all retail sales in the United States in 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, which started as a single day in 2015, expanded to two days in 2019 and four days in 2025. It has been held increasingly earlier in recent years to better capture the lull in summer shopping for which the event was created in the first place. Emarketer analyst Sky Canaves pushed the Prime Day timeline earlier each year, suggesting the move was “a way to test whether Amazon can expand the types of purchases consumers make during Prime Day.” Amazon has generally focused on selling in categories it dominates, such as consumer electronics and other expensive products. But Canaves explained that there has been a “marked shift in the categories shoppers are buying” in recent years as high inflation has driven consumer confidence to historic lows. Inflation, measured by the consumer price index, increased by 4.2% on an annual basis in May, reaching its highest level in the last three years. This was largely due to high energy costs related to the Iran war. (At the time, Jim Cramer was on record as saying that oil prices should fall when the war ends. That’s what’s happening now, but it won’t show up in economic numbers for a while.) Higher prices put additional pressure on household budgets and increase consumers’ appetite for discounts and value. Canaves said “budget awareness” has become much greater. Prime Day shoppers have become more interested in deals on personal care and beauty products, as well as daily essentials and groceries. “These are smaller ticket items that they will use to stock Prime Day,” the Emarketer analyst added. This is a trend supported by recent consumer surveys. According to an April survey by marketing platform Omnisend, 53% of respondents said deep discounts were their main motivation for shopping on Prime Day. The survey found that 55% of U.S. consumers plan to attend this year, up from 45% last year, while 66% expect to spend the same amount or more as they did at the previous event. “A lot of people use Prime Day strategically,” said Marty Bauer, e-commerce expert at Omnisend. “Their plan is to stock up on daily essentials while discounts are available.” Prime Day’s increased focus on home essentials dovetails with Amazon’s increased investment in fresh and perishable grocery items, categories that are gaining traction as Amazon expands its same-day delivery capabilities, Canaves said. Unlike electronics purchases, food and essentials are a “big hook” for consumers, Canaves said, adding that such products encourage repeat purchases. Amazon already has a strong presence in these categories. Canaves notes that some of the best sellers at recent Prime Days include energy drinks, Liquid IV hydration products, and supplies, as well as Amazon’s own devices. Canaves said that over the years, Prime Day has focused on increasing the value existing members get from their Prime subscriptions rather than adding new members. That’s because you have a pretty good problem. Emarketer estimates there are currently almost 190 million Prime users in the US; this number represents more than 86% of all online buyers in the United States. “Once you get to this point, it’s very difficult to grow because the market is almost saturated with members; almost everyone has access to a Prime account,” Canaves added. Amazon targeted younger consumers through discounted membership programs, cash-back offers, and promotions aimed at college and back-to-school age customers. According to Emarketer, GenZ and millennial Prime members are more excited than older generations about moving the event from July to June and tend to be the drivers of Prime Day spending. This year’s Prime Day will also be Amazon’s opportunity to highlight Alexa for 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 for Shopping “an essential tool for discovering and tracking deals during Prime Day” in its June 18 preview note of the online shopping event. Analysts believe Alexa will be “an important tool for Amazon to retain direct traffic as well as enable higher conversion rates and drive incremental spend on the platform.” They estimate that Alexa could generate more than $200 billion and $20 billion in incremental retail profits by 2035. Bank has a buy rating on Amazon and a $310 price target. As a result, Prime Day is a strategic event for Amazon to strengthen customer loyalty and, even more so today, to encourage higher-frequency repeat purchases such as groceries and daily essentials. Amazon’s goal is to drive deeper customer engagement in the core products category rather than a short-term sales boost. The stock has underperformed, gaining 1.7% year-to-date, in a market that looks unfavorable for mega-caps that are spending billions of dollars on building AI infrastructure. The S&P 500 is up 9% in 2026. We hope Amazon won’t raise equity like Alphabet did with its $85 billion stock sale to fund AI development. At 27 times forward earnings, Jim said he’s “very concerned” about Amazon’s valuation. But there are also reasons to stay positive. Cloud business Amazon Web Services (AWS) has seen accelerating growth with incredible margins. If oil prices continue to fall, this will give impetus to the retail business, given that high fuel costs are a major input cost for the company and a deterrent for consumers. We have a buy-equivalent 1 rating and a $300 price target on Amazon shares. (Jim Cramer’s Charitable Trust is long AMZN, GOOGL. See here for a full list of stocks.) When you subscribe to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trading alert before buying or selling a stock in his charitable foundation’s portfolio. If Jim talked about a stock on CNBC TV, he would wait 72 hours after issuing the trading alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH THE DISCLAIMERS. NO CIVIL OBLIGATIONS OR DUTIES EXIST OR SHALL BE RESULTING FROM YOUR RECEIVING ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. 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