Amazon and other e-commerce stocks slid Thursday amid a market rout after President Donald Trump announced plans for tariffs on most imports. Trump also plans to end a duty exemption on small imports that had benefited discount e-commerce platforms with China-based sellers such as Temu and Shein.
The scale of Trump's tariff plans has unsettled investors around the globe. The usually bullish Wedbush tech stock analyst Dan Ives called the slate of tariffs an "economic Armageddon" in a client note late Wednesday, though he encouraged investors to view them as the start of a negotiation.
Wall Street has been debating in recent weeks just how much Amazon could be hit by increased tariffs. China-based sellers have more than 50% market share on Amazon's third-party seller marketplace, according to research from MarketPlace Pulse.
BofA Securities analyst Justin Post wrote last month that tariffs were a "sector negative" for e-commerce. However, the analyst said, "platforms with large third-party selections, such as Amazon or eBay, can allow for better substitution and/or for consumers to self-select cheaper items."
He added that marketplace operators such as Amazon, eBay and Etsy "still collect commissions on the final value of third-party sales, so higher pricing could be a tailwind."
Trump Plans End To De Minimis Exemption
Meanwhile, Trump is also planning to end the so-called de minimis exemption for packages from China. The rule allows packages valued at $800 or less to enter the U.S. duty-free. The more than 90-year-old provision has come under greater scrutiny in the past two years, as global e-commerce platforms Temu and Shein have grown rapidly by shipping individual items straight to U.S. households from Chinese merchants.
There were 1.36 billion de minimis shipments in 2024, according to U.S. Customs and Border Protection data, compared to 640 million total in 2020.
Temu's rapid growth in 2023 and 2024 prompted Amazon to launch a competing part of its website with a direct-from-China sales model, called Amazon Haul.
In an executive order Wednesday, Trump said that the de minimis provision has allowed some shippers to "hide illicit substances and conceal the true contents of shipments."
Trump first attempted to end the policy in February before putting that plan on hold. Former President Joe Biden last year proposed limits on which products could qualify for the exemption, though the rule had yet to take effect.
Amazon Stock, PDD Shares Fall
Amazon stock fell 9% to close at 178.41 on the stock market today. Etsy fell 4% to 48.41. EBay lost 1.5% to close at 66.36.
U.S.-listed shares of Temu parent company PDD Holdings fell 4.5% to 113.67. PDD, which also owns the Pinduoduo shopping platform in China, has taken steps such as onboarding U.S. sellers and adding U.S. warehouses to address its risk from changes to the tariff exemption.
Temu is also a major purchaser of social media advertising, particularly from Facebook and Instagram. Meta Platforms stock lost 9% to close at 531.62.
