Exclusive: Amazon US Prime sign-ups slow despite expanded promotion, data shows

Internal data reviewed by Reuters reveals Amazon's U.S. Prime sign-ups for the 21-day period surrounding Prime Day declined year-over-year and missed internal targets by approximately 2%, contradicting the company's public claims of record growth. This slowdown in new member acquisition, particularly a 5% miss in the crucial pre-event period, is significant given Prime's strategic importance as a major revenue driver ($23.9 billion in H1) and its role in fostering higher customer spending and retention amidst increasing competition.

Analysis

Leaked internal data reveals a critical divergence between Amazon's public narrative and its operational performance regarding the Prime membership program in the U.S. Despite an extended four-day Prime Day event and public statements from CEO Andy Jassy citing record sign-ups, total U.S. Prime acquisitions over the 21-day promotional period declined by approximately 2% year-over-year, missing internal targets by 106,000 and totaling 5.4 million. The weakness was particularly pronounced in the crucial three weeks leading up to the event, where sign-ups missed both the prior year's figure and the company's goal by roughly 5%. This slowdown in a key U.S. market suggests potential saturation and intensifying competitive pressure from rivals like Walmart. The discrepancy is material for investors, as the Prime program is a significant revenue driver, generating $23.9 billion in H1, and is strategically vital for fostering higher customer lifetime value, with members spending over double that of non-members ($1,170 vs. $570 annually in 2024). The negative sentiment signal (-0.4 for AMZN) is justified, as this data challenges the core growth story of Amazon's retail subscription engine.

Key Decisions for Investors

• Investors should scrutinize future subscription revenue figures and any management commentary on Prime growth, as the leaked data indicates a potential deceleration in this key U.S. profit center.
• The data exposes a potential vulnerability to competitors like Walmart, warranting a closer analysis of Amazon's domestic market share and the durability of its competitive moat in an increasingly crowded subscription-based retail environment.
• The disparity between CEO commentary and internal metrics raises questions of transparency; portfolios should be managed with an understanding that public forward-looking statements may not fully reflect underlying business trends.
• Consider the potential long-term impact of slowing U.S. subscriber growth on the company's valuation, weighing it against initiatives like the $4 billion investment in rural delivery intended to tap new customer segments.