EU Brands Tap Tariff Loophole

Amazon’s core retail business held strong in Q2 2025, with consumers continuing to spend despite tariffs and a complex macro backdrop. The company posted $100.1 billion in North America sales, a YoY rise of 11%, and $7.5 billion in operating profit from that segment—a 48% jump. While AWS margins softened, e-commerce showed clear signs of pricing power, operational discipline, and improved shopper engagement.

🛒 E-Commerce Resilience: Amazon’s online product sales climbed to $61.5B, up 11% YoY, while third-party seller services like FBA and listing fees grew to $40.3B, also up 11%

📦 Fulfillment Gets Smarter: With 1M+ robots in action and new AI tools like DeepFleet optimizing warehouse movement, Amazon improved productivity and delivery speeds

📱 Prime Day + Product Expansion: Q2 included Amazon’s biggest-ever Prime Day, plus new DTC partnerships with Nike, Marc Jacobs, and Aveda

📊 Ads Keep Driving Margins: Advertising revenue surged 23% YoY to $15.7B, continuing to be one of Amazon’s most profitable business lines and a critical tailwind for overall e-commerce margin growth

European brands are increasingly turning to a little-used U.S. customs provision known as the “First Sale” rule to offset the financial hit from new tariffs imposed by the Trump administration, according to a Reuters report. Companies like L’Oréal, Moncler, Ferragamo, and Golden Goose are exploring the rule, which allows duties to be calculated based on the product’s factory price rather than its final retail price.

📦 How does it work?: To qualify for the First Sale rule, goods must be sold at least twice — first by the overseas producer to an intermediary, then onward. Each transaction must be at arm’s length between independent, unrelated parties. Importers must prove the goods were intended for the U.S. and provide full documentation of the initial sale price

📈 Increased interest: Consulting firms like KPMG and PwC told Reuters they’ve seen a surge in inquiries this year

💸 Past records: While no current data exists, a 2009 U.S. ITC report found that 8.5% of importers used the First Sale rule, accounting for 2.4% of total U.S. import value — nearly half of it tied to footwear and apparel

JCPenney has finalized a $947 million deal to sell 119 of its store properties across 35 states to private equity firm Onyx Partners, five years after emerging from Chapter 11 bankruptcy. The all-cash real estate transaction, announced by Copper Property CTL Pass Through Trust, is set to close by September 8.

Despite the ownership change, JCPenney confirmed that all affected stores will remain open and continue normal operations. The retailer emphasized that the deal only changes landlords and has no impact on its store footprint or customer experience.

Proceeds from the sale — expected to total up to $932 million after closing costs — will go to the trust’s certificate holders, primarily former creditors. The stores are part of the portfolio transferred to the trust during JCPenney’s 2020 bankruptcy restructuring. The department store chain currently operates nearly 650 locations, down from 846 before its restructuring.

Amazon announced it will discontinue its Fulfillment by Amazon (FBA) prep and labeling services for U.S. shipments starting January 1, 2026. The company said the decision reflects improved packaging capabilities among third-party sellers, who now handle the majority of product prep—including bubble-wrapping, stickering, and labeling—either directly or via manufacturing partners.

The change applies to all U.S. FBA shipments created on or after the cutoff date. Any inventory sent without proper prep or labeling will no longer be eligible for reimbursement if damaged or lost. Amazon is urging sellers to begin auditing SKUs that currently rely on its prep services and to update workflows accordingly.

Note: With Amazon shutting down its FBA Prep and Labeling Service, 3PLs and prep centers are likely to see a rise in prep volumes. With Hopstack’s Ignite, they can streamline the entire FBA prep workflow — from ASIN eligibility check to accurate prepping, packing, and shipment to Amazon Fulfillment Centers.

US consumer sentiment rose in July to its highest level since February, driven by a stock market rally and easing inflation expectations, according to the University of Michigan’s monthly survey. The final sentiment index climbed to 61.7 from 60.7 in June, while long-term inflation expectations fell to 3.4%, the lowest since January.

Consumers now expect prices to rise 4.5% over the next year, down from 5% in June. While stock-owning consumers reported higher confidence, sentiment among non-investors declined, tempering the overall rise.

Despite the gain, concerns remain. The expectations index dipped to 57.7, and 57% of respondents foresee rising unemployment — up sharply from last year. The labor outlook remains weak, with July’s three-month average payroll growth the slowest since the pandemic.

VF Corporation reported a stronger-than-expected performance in its fiscal Q1 2026, reducing net losses by 55% year-over-year to $116.4 million. Revenue fell slightly by 0.47% to $1.76 billion, but the company said its revenue trend had stabilized, supported by ongoing restructuring efforts that cost $207.6 million during the quarter.

The North Face overtook Vans as VF’s top-earning brand, generating $557.4 million and accounting for 31.7% of total revenue. Vans brought in $498 million, down significantly from $581.8 million a year ago and now representing 28.3% of the portfolio. Timberland contributed $255.1 million, or 14.5% of total sales.

The United States remained the group’s largest market, delivering $937.6 million in revenue, or 53.2% of the total. Sales in the EMEA region reached $551.3 million (31.3%), while Asia-Pacific contributed $271.8 million (15.4%).

Prosus, the Dutch tech investor, is expected to receive European Union antitrust clearance for its €4.1 billion ($4.7 billion) acquisition of Just Eat Takeaway, according to Reuters. The approval is contingent on Prosus agreeing to reduce its 27.4% stake in Delivery Hero and relinquishing its board seat.

The European Commission is currently soliciting market feedback and is set to rule on the deal by August 11. The proposed acquisition would position Prosus as the fourth-largest food delivery platform globally, behind Meituan, DoorDash, and Uber, according to ING analysts.

Prosus and Delivery Hero both compete in several European markets, including Austria, Italy, and Spain. The deal comes weeks after Delivery Hero and its Spanish subsidiary Glovo were fined €329 million by EU regulators for anti-competitive practices

China’s top food delivery players — Meituan, Alibaba’s Ele.me, and JD.com — have pledged to end their aggressive subsidy-driven price war following regulatory pressure from Beijing.

The companies issued coordinated statements vowing to promote “orderly competition” and scale back unsustainable promotions in the $80 billion food delivery market.

The move follows a July meeting with the State Administration for Market Regulation, where officials urged the firms to stop practices seen as destabilizing the industry. In response, Ele.me said it would avoid irrational discounting and protect merchant margins, while Meituan committed not to force vendors into participation. JD.com said it would stop offering “malicious” subsidies.

The battle had escalated in recent months, with JD entering the market offering steep discounts, prompting Meituan and Ele.me to retaliate.

Google has rolled out a new AI-driven feature in its Chrome browser for U.S. users, offering automated summaries of online store reputations. The summaries, accessible via an icon next to the web address, highlight key details like product quality, pricing, customer service, and return policies — aiming to help users make faster, safer shopping decisions online.

The move is part of Google's broader push to integrate AI across its shopping ecosystem, positioning itself against Amazon’s growing use of AI for product reviews and personalization. It also comes amid rising competition in the browser space from new AI-native challengers like Perplexity’s Comet.

The European Commission has accused Chinese e-commerce platform Temu of failing to prevent the sale of illegal products within the EU, following a preliminary investigation under the bloc’s Digital Services Act (DSA).

Investigators conducted a mystery shopping exercise and found non-compliant items listed on Temu, including baby toys and small electronics. While the European Commission did not detail the exact violations, it noted a broader trend of rising online sales in the bloc being accompanied by a surge in unsafe or counterfeit goods. Temu, in response, said it will continue to cooperate with the Commission fully.

Walmart has reached a settlement with Zest Labs, ending a long-running legal battle over proprietary produce prediction technology. The federal judge overseeing the case confirmed the resolution this week, though financial terms were not disclosed. The settlement follows a May jury verdict awarding Zest Labs over $222 million after it accused Walmart of misusing its patented "Zest Fresh" solution under a nondisclosure agreement.

Zest Labs alleged that Walmart shared and then replicated its shelf-life prediction technology, which is designed to reduce food waste by improving freshness tracking across the supply chain. While the legal dispute is now resolved, Walmart continues to invest in produce innovation.

Adidas shares fell over 7% after the sportswear giant warned that U.S. tariffs could cost the company €200 million ($231 million) in the second half of 2025. The German brand said it had already absorbed a “double-digit million euro” tariff impact in Q2 and may be forced to raise prices in the U.S. market if duties persist.

CEO Bjørn Gulden said any potential price increases would apply only to U.S. consumers and would likely affect new products rather than existing lines. The company is currently reviewing its pricing strategy ahead of the expected August 1 tariff revisions. Adidas has so far managed the impact by adjusting its sourcing mix instead of raising retail prices.

The company cautioned that extended tariff uncertainty could weaken U.S. consumer demand and spark broader inflationary pressures.