If it seems like your Amazon shopping cart has become more expensive lately, you’re not imagining things. And according to Amazon CEO Andy Jassy, things are likely to get worse.
After months of downplaying the impact of the new trade policy, Jassy recently relented interview that higher prices become inevitable.
By July 2025, Jassy had allayed concerns about rates and told investors it was too early to panic.
Amazon did manage to keep prices stable for a while by purchasing inventory in advance – essentially stocking up on goods before new taxes went into effect.
That strategy allowed the e-tail giant to avoid the immediate impact of cost increases. But now the company must replenish its inventories, and at higher rates.
“You’re starting to see some tariffs trickle down into some prices,” Jassy said. He noted that while some third-party sellers absorb the costs to keep sales high, many pass those costs directly to you.
Who actually pays the rates?
There is often debate about who foots the bill for tariffs, but the data paints a clear picture.
Research by the Kiel Institute for the World Economy has shown that foreign exporters absorb less than 4% of the tariff burden. The remaining 96% is passed on to US buyers.
In other words, if it costs more to bring products into the country, retailers – and ultimately shoppers – pay the difference.
It’s not just Amazon
Amazon isn’t the only retailer in trouble. Executives from Walmart, Target and Best Buy all issued similar warnings, noting they can’t absorb these costs forever.
Jassy says Amazon works with partners to keep prices as low as possible, but he was blunt about the limitations: “You don’t have endless options.”
For now, it’s a good idea to keep an eye on prices for discretionary items, as these are likely to see the biggest jumps.
Is Amazon in trouble?
The price warning comes amid a huge uproar. Reuters reports that Amazon just confirmed job cuts of 16,000 corporate jobs, completing a reduction of about 30,000 jobs since October. It is the largest workforce reduction in the company’s history.
Amazon is also permanently closing its remaining Fresh supermarkets and Go Markets, ending a years-long experiment with brick-and-mortar retail. It is also scrapping the Amazon One biometric payment system that allows you to pay with a scan of your palm.
While executives point to reducing bureaucracy, automation is the most important factor.
The company says advances in artificial intelligence and robotics are changing the way it works, reducing the need for certain human roles in both corporate offices and warehouses.
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