Amazon Prime

Amazon's speedy one-day shipping is denting its profits

A wall with the Amazon logo on it.
An Amazon warehouse outside Paris. Photo: Philippe Lopez/AFP via Getty Images

Amazon shares fell more than 6% Thursday after the company's quarterly earnings fell for the first time in two years, coming in below analysts' expectations.

Between the lines: Amazon had been posting record profits in recent quarters, but its move to offer one-day shipping to Prime customers is clearly denting the bottom line. Last quarter, the company spent nearly $10 billion on shipping, but the company has long been willing to sacrifice short-term profitability to make moves that are popular with consumers and are hard for rivals to match.

Go deeper: More than 200 independent musicians plot Amazon boycott over work with ICE

The inexplicable decline in retail sales growth

Illustration: Rebecca Zisser/Axios

Headlines Tuesday painted a picture of a booming U.S. retail market: Amazon's well-covered Prime Day(s) generated an estimated $5.8 billion of sales and the Commerce Department's retail sales report showed an especially strong reading for June.

Yes, but: A deeper dive into the data shows retail sales growth is slowing, with the all-important online component — the major source of growth, as brick-and-mortar sales struggle — cooling notably.