Home » Latest News » E-commerce & AI News Flash Collection (May 31): Amazon Expands in Alaska, Target Slashes Prices

E-commerce & AI News Flash Collection (May 31): Amazon Expands in Alaska, Target Slashes Prices

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US

Amazon: Expanding Distribution in Alaska

Amazon plans to open a distribution center in Fairbanks, Alaska, to enhance its last-mile delivery network. The new facility, covering 47,000 square feet, is located at 3121 Airport Road. It will improve delivery speed and reliability for customers in Alaska and nearby regions. The project will create several hundred jobs, with hourly wages ranging from $17 to $28. This follows the opening of Alaska’s first last-mile delivery station in Anchorage in 2023.

US Customs Policy: Impact on E-commerce

The U.S. Department of Homeland Security has intensified enforcement of the “small waiver” import policy, affecting platforms like Temu. Customs and Border Protection has suspended Seko Logistics’ Type 85 Customs Clearance participation for at least 90 days. This policy allows small parcels under $800 to clear customs quickly and duty-free. The action is part of efforts to close loopholes that could harm U.S. manufacturers. The suspension highlights potential challenges for e-commerce platforms’ growth.

Target, Walmart, Amazon: Price Reductions to Attract Consumers

Retailers including Target, Walmart, and Amazon have lowered prices on various products to appeal to inflation-affected consumers. Target introduced 1,000 new low-priced items for summer, while Walmart reduced prices on nearly 7,000 items. AmazonFresh offered up to 30% discounts on 4,000 products both online and in stores. This strategy aims to attract low-income consumers while retaining high-income shoppers through premium product offerings.

Globe

Chewy: Strong Start in 2024

Chewy reported a strong first quarter for fiscal year 2024, with net sales reaching $2.88 billion, up 3.1% year-over-year. The company achieved a gross margin of 29.7% and a net income of sixty seven million. Adjusted EBITDA was one hundred seventy million, a significant increase from the previous year. Chewy’s Autoship program saw record sales of $2.2 billion, accounting for 77% of net sales. The company expects full-year sales between $11 billion and $11.8 billion, with an adjusted EBITDA margin of 4.1% to 4.3%.

Pattern Study: Australian Consumer Preferences

A study by Pattern revealed insights into Australian consumers’ trust and shopping habits across seven e-commerce platforms. Amazon leads with 58% consumer trust, followed by eBay at 39%. Despite a high number of online shoppers, only 7% trust Temu’s product quality. Amazon remains the dominant platform, attracting 48% of shoppers, while eBay and Catch follow. High-income consumers prefer Amazon for its product variety and convenience.

Douglas Group: Growth in Sales and Expansion

Douglas Group reported an 11.5% increase in overall sales, reaching approximately €958 million in the first quarter of 2024. In-store sales grew by 11.9%, while e-commerce sales increased by 10.7%. Over the past six months, net sales rose to around €2.5 billion, with adjusted EBITDA at €494.2 million. The company opened 10 new stores and renovated 37, with plans for further expansion. Douglas Group expects a 7% sales growth for the fiscal year, driven by both in-store and online channels.

Active Apparel Group: Environmental Initiatives

Active Apparel Group (AAG) has announced new strategies to reduce its global environmental impact. Implementing an ISO 14001 framework, AAG aims to cut energy consumption and minimize air freight. The company will also reduce water usage and increase sustainable materials in its production. Quarterly progress reports will be reviewed by the board. AAG’s CEO emphasized the company’s commitment to a decarbonized future, aligning with industry standards.

Amazon Prime now includes a Grubhub food delivery subscription

Amazon has expanded its Prime membership benefits to include a permanent subscription to Grubhub’s food delivery service. Previously, Prime members received a one-year Grubhub subscription with free delivery on orders over $12. This new agreement allows non-Prime members to place Grubhub orders through Amazon’s website and app. The collaboration strengthens Amazon’s competitive edge against Walmart and Target’s loyalty programs. Amazon holds a 4% stake in Grubhub, with options for an additional 4% under a new 5-year agreement and potential warrants for up to 10% based on performance metrics.

Best Buy jumps 13% as cost-cutting preserves profits despite sluggish sales

Best Buy reported earnings for Q1 2025 that exceeded Wall Street expectations, despite lower-than-anticipated sales. The company’s shares rose 13% as it maintained its full-year forecast, expecting revenue between $41.3 billion and $42 billion, a slight decrease from the previous year. CEO Corie Barry highlighted industry stabilization and sequential improvement in sales trends over the next three quarters, despite challenges such as persistent inflation and high mortgage rates. Best Buy saw growth in its services and laptop categories, though comparable sales fell by six percent. The company continues to focus on cost-cutting measures, including layoffs and store updates, to drive growth.

Amazon to expand drone delivery service after clearing FAA hurdle

Amazon has received federal approval from the FAA to fly its delivery drones beyond the line of sight of ground spotters, enabling the company to extend its drone delivery service to more areas in the U.S. This approval follows the development of collision-avoidance technology, allowing drones to detect and avoid obstacles during flight. Amazon will expand its delivery operations in College Station, Texas, and is planning to launch services in Phoenix, Arizona, later this year. Despite past challenges, including layoffs and regulatory setbacks, Amazon aims to deliver 500 million packages by drone annually by the end of the decade.

Nordstrom misses Wall Street’s earnings expectations as off-price chain Rack lifts sales

Nordstrom’s Q1 2024 earnings fell short of Wall Street’s expectations, despite growth driven by its off-price chain, Nordstrom Rack. The retailer reported a net loss of $39 million compared to a $205 million loss the previous year, with total revenue rising to $3.34 billion. Nordstrom Rack saw a 7.9% increase in comparable sales, outperforming the flagship brand, which had a 1.8% rise. Activewear sales led the quarter with double-digit growth, while kids’ and women’s apparel and beauty sales also saw significant increases. Nordstrom reaffirmed its full-year earnings forecast and continues to open new Rack stores to drive growth.

AI

Omdia Report Predicts AI-Driven Surge in RISC-V Processor Market

A recent Omdia report forecasts significant growth for RISC-V processors, expecting their market share to rise from 0.7% in 2020 to nearly 25% by 2030. The increase is driven by advancements in AI and a higher demand for customizable, license-free hardware. RISC-V processors are anticipated to play a crucial role in industrial settings and the automotive industry, with automotive adoption growing by sixty six percent annually. The report projects RISC-V AI processor shipments to more than double annually until 2030. This growth will support more intelligent processing in industrial IoT devices, highlighting RISC-V’s potential in new AI applications.

Google scales back AI search answers after errors

Google has reduced the use of AI-generated answers in search results following high-profile mistakes, such as advising users to put glue on pizza and incorrectly stating Barack Obama was Muslim. Introduced two weeks ago, these “AI Overviews” were meant to enhance search results but have now been scaled back, especially for health-related queries and sources from social media. Google made several technical adjustments to improve accuracy and reliability. The rollback follows Google’s pattern of launching AI products with great fanfare, only to withdraw them after errors. Despite setbacks, Google continues to position itself as a leader in AI technology.

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