Melville House Books

Announcing its third quarter results last week, Amazon.com tried to emphasize its pro-forma sales increase, but the rumbling amongst Wall Street analysts is that Amazon’s “days as a hot-shot dot-com may be behind it” because “the Internet retailer’s slowing growth makes its business suspiciously similar to that of its brick-and-mortar peers.” According to Elizabeth Lazarowitz in a Reuters wire story, “The keys to this shift are the company’s decelerating revenue growth and its deteriorating operating margins.” Analysts from several major firms, including J.P. Morgan and Piper Jaffray, have given forecasts of decreasing growth, she says. In particular, “Amazon’s pledge to continue to offer free shipping to draw customers and decision to boost its operating expenses by 23 percent to expand its infrastructure rattled investors since both will bite further into its weakening operating margins.”

Dennis Johnson is the founder of MobyLives, and the co-founder and co-publisher of Melville House.