Due to the violation of regional privacy laws, European regulators imposed a massive fine on Amazon. The fine amount was $885 million which costs Amazon more than $130 billion in stock losses. The second-quarter earnings also failed to meet the expectation predicted by Wall Street. For the e-commerce giant, this is the worst moment in more than a year.
Last Friday, Amazon’s stock plunged 7% and stock price stood about $3,349.50. the massive stock price fall resulted in the companies’ market capital down below $1.7 trillion from $1.8 trillion. As a result, Amazon loses $130 billion between Thursday and Friday.
Despite having a 48% up in net worth, the company fell short of $7.7 billion which is expected to be $7.8 billion. This is the worst drop of Amazon’s capital in one day since May 2020. At the beginning of the pandemic, Amazon had a similar strike on its stock values. It is not new for Amazon, in October 2018 Jeff Bezos alone lost $22 billion due to stock fall.
According to Amazon, the European authority imposed an $885 million fine on July 16, and after the disclosure, the disappointment caused this massive loss.
Luxemburg National Commission for Data Protection finds Amazon accountable for the incompliant personal data collection as it does not comply with European law.
In response to the decision of the European authority, Amazon states that no data breach occurred. And the company also believes that the watchdog made the judgment without merit. Furthermore, the firm is preparing to appeal the ruling to defend itself.