Amazon CEO Andy Jassy warned on Tuesday that President Trump's tariffs are already being felt in the prices of certain products as sellers decide how to manage the impact of these increases. "Some sellers are deciding to pass on these higher costs to consumers in the form of higher prices, others are deciding to absorb them to boost demand, and others are doing something in between," Jassy said in an interview with CNBC from the World Economic Forum in Davos, Switzerland. The CEO said that the company and most of its third-party sellers made inventory of many products when the tariffs were announced, but the vast majority of them sold out last fall. A few months ago, shortly after Trump announced the tariffs, Jassy was optimistic about the consequences and said there was no perceived price increase. "Amazon is not exceptionally susceptible to tariffs," he expressed. However, he has now changed his tune. According to him, Amazon is trying to keep "prices as low as possible" so that consumers don't suffer, but he commented that in some cases, the cost increase will be inevitable. "At some point, since retail is, as you know, a business with a single-digit operating margin, if people's costs go up by 10%, there aren't many places to absorb it," he stated. Still, he said that consumers are showing quite "resilience" and continue to spend without thinking about the tariffs, although many are opting for cheaper items or smaller versions of what they used to buy.
