Amazon’s (AMZN - Free Report) recently announced record-breaking holiday sales numbers, which is a testament to its outstanding performance in this holiday season.
Further, it indicates that the company has been successful in gaining significant momentum during this particular season. This can be attributed to its robust e-commerce platform and aggressive retail strategies. Moreover, this is good news for Amazon as it had spent heavily on each of its holiday initiatives.
Notably, the company experienced robust sales in product categories such as toys and games, electronics, fashion, beauty, pets, sports, books and home.
Further, the company witnessed strong performance of its own brands like Amazon Essentials, AmazonBasics, 365 Everyday Value and Solimo during this holiday season.
Additionally, the company experienced solid demand for Amazon Devices. Notably, Echo Dot, Echo Show 5, Fire TV Stick with Alexa Voice Remote, Echo Auto and Amazon Smart Plug were among the bestselling devices.
Significant Holiday Initiatives
The e-commerce giant adopted several initiatives to cater to the growing demand of customers efficiently and quickly during the peak season. Moreover, these initiatives helped in enhancing user experience.
We note that the number of Amazon-branded trucks, which drove up and down across the United States this holiday season came in at 20,000, double the prior year’s number.
Further, Amazon made 10 million items that included holiday gifts such as toys, games, and electronics, among others, eligible for free one-day delivery service for Prime members across the United States. This was done with an aim to enhance shopping experience during the holiday season.
Additionally, above 250,000 full and part-time seasonal jobs were created across the company’s global customer fulfillment network during this holiday season.
Moreover, the company temporarily suspended the usage of FedEx’s (FDX - Free Report) ground delivery network for its Prime shipments, in order to prevent delays in the delivery of the packages.
Further, the company banked on its streaming initiative. The release of mini-documentary about Mariah Carey’s groundbreaking hit, All I Want for Christmas is You, aided Amazon Music to gain significant momentum.
Amazon’s continued focus toward strengthening original content portfolio reaped benefits as well. The view rate of Amazon Originals by Prime members during this season was the highest ever.
All these initiatives along with Amazon’s distribution strength, vast product portfolio and deep discounts on products drove performance this holiday season.
Prime: A Key Catalyst
Amazon Prime remains a key catalyst for the company’s robust holiday sales backed by customer friendly offers, cashback benefits and strengthening delivery services.
The company continued to witness acceleration in Prime adoption rate. Notably, there were more than 5 million new customers in one of the holiday season weeks opting for Prime free trials or joining as paid members.
Further, the number of items delivered with Prime Free One-Day and Prime Free Same-Day Delivery quadrupled during this peak season.
Further, Amazon Hub location and Amazon pickup point gained traction during this holiday season.
We believe record breaking sales and increase in Prime membership during this holiday season are likely to drive the top line.
Zacks Rank & Stocks to Consider
Currently, Amazon carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the retail-wholesale sector that can be considered are Zumiez (ZUMZ - Free Report) and Fiverr International (FVRR - Free Report) . While Zumiez sports a Zacks Rank #1 (Strong Buy), Fiverr carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Zumiez and Fiverr International is pegged at 12% and 44.18%, respectively.
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