Amazon Prime's U.S. Growth Stops After Five Years: Study

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Amazon's Prime service stopped growing in the United States after consistently gaining traction for half a decade, according to a new study conducted by Mark Mahaney, an analyst with RBC Capital Markets. The platform's penetration accounted to 55-percent last month, up from 25-percent recorded in June of 2013, but its May 2018 performance was unchanged year-on-year, marking its first stagnation in five years. The author reflected on the finding as "a bit of a surprising result," especially in the context of Prime's global performance which continues to excel across the board, with the tech giant just recently announcing it surpassed 100 million Prime subscribers on a worldwide level.

While the study relied on a representative sample of responders, its pool of interviewees numbered only 2,000 individuals and hence may not be perfectly representative of reality. Regardless, the author maintains his findings imply Prime's growth is now largely reliant on the company's global expansion efforts and clearly suggests the stateside popularity of the service already peaked. With e-commerce being the core of the firm's business model and its retail offerings being entirely centered around Prime, that state of affairs could imply that Amazon's stock may stop growing in an aggressive manner in the near future. Numerous analysts bullish on Amazon previously predicted the Seattle, Washington-based firm could be the world's first conglomerate to break the $1 trillion valuation mark but that achievement may require more than just continued U.S. investments, the new study suggests.

Amazon's medium-term Prime strategy is presently largely focused on Prime Video, with the firm committing significant resources toward attracting new creative talent and licensing valuable IPs such as The Lord of the Rings in order to produce more exclusive content that would attract new subscribers to its service. The e-commerce juggernaut is also paying attention to sports, having recently won rights to air twenty Premier League games per year for three seasons, starting with the 2019/20 one.

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