Amazon is making it easier for businesses to ship stuff—and it's not just for Amazon sellers anymore. On Wednesday, the company expanded its less-than-truckload (LTL) freight service across the U.S., letting any business ship palletized freight to warehouses, distribution centers, and retail partners, even if those destinations have nothing to do with Amazon's own network.
The service, part of Amazon Supply Chain Services (ASCS), handles shipments of one to six pallets and comes with features like real-time GPS tracking, automated scheduling, electronic proof of delivery, and EDI integrations. In other words, Amazon is offering a full-blown logistics product that competes with traditional freight carriers.
This isn't just a small experiment. Amazon says the LTL expansion is backed by a network of more than 80,000 trailers and 24,000 intermodal containers. And it's not new—the service has been available to select sellers and vendors since 2019, and demand has been strong enough to justify a nationwide rollout.
The AWS Playbook for Logistics
If this sounds familiar, it should. Amazon is essentially doing for logistics what it did for cloud computing with AWS: building infrastructure for its own needs, then opening it up to everyone else. Bank of America estimates the global third-party logistics market is worth $1.3 trillion, and analysts have said Amazon's ASCS rollout could become a significant long-term growth driver by monetizing the logistics infrastructure originally built for its retail operations.
Think of it this way: Amazon already has the trucks, trailers, and systems to move goods around the country. Now it's letting other companies pay to use that network, turning a cost center into a profit center.
Stock Performance: Near-Term Noise, Long-Term Trend Intact
Amazon shares edged lower in Wednesday's premarket trading, down 0.41% to $243.20, as a broader risk-off move weighed on technology stocks. Nasdaq futures were down 1.35%, so Amazon wasn't alone in the red.
Despite the pullback, the stock remains above its 100-day and 200-day moving averages, which means the longer-term uptrend is still intact. However, it's trading below its 20-day and 50-day moving averages, and the MACD indicator is bearish—signaling softer near-term momentum. So, short-term traders might be cautious, but long-term investors probably aren't sweating it.
What Wall Street Expects
Analysts are still bullish on Amazon ahead of its expected July 30 earnings report. They expect second-quarter earnings per share to rise to $1.82 from $1.68 a year earlier, an 8.3% increase. Revenue is projected to hit $195.94 billion, up 16.8% from $167.70 billion last year.
The stock carries a Buy consensus rating with an average analyst price target of $320.86. Recent analyst moves include:
- TD Cowen: Buy, maintains $350.00 target (May 12)
- Truist Securities: Buy, raises target to $320.00 (May 29)
- Wells Fargo: Overweight, lowers target to $312.00 (May 20)
So, while one analyst trimmed their price target, the overall sentiment remains positive. The LTL expansion could be another catalyst to watch as Amazon continues to build out its logistics empire.
