Amazon (AMZN), the high-flying stock of 2020, has dropped 7.3 percent over the last 24 hours after revealing underwhelming Q1 earnings results. The company’s profit declined 29 percent compared to the previous year.
After the stock slid five percent in pre-market trading, and it is now under even more pressure on the news about Bezos testifying before Congress.
Not too big to fail
This slump in the road happened just two weeks after Amazon reached a new all-time high. The e-commerce juggernaut was able to benefit from people ordering essential products en masse in the midst of the coronavirus pandemic.
After Bezos struck a cautious note about the coronavirus pandemic during Amazon’s earnings call, it became clear that even the fourth-largest company in the world wasn’t invincible.
The fact that Amazon is going to shell out $4 bln to combat COVID-19 also didn’t sit well with the company’s shareholders.
Bezos faces a subpena
U.S. lawmakers are now calling Bezos to testify before the House Judiciary Committee while accusing him of lying to Congress.
Back in April, The Wall Street Journal shed light on Amazon employees using unfair business practices to stifle third-party competitors, which was denied by Bezos.
In their letter to the Amazon CEO, which cites the WSJ report, the lawmakers describe these actions as “perjurious.”