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On Wednesday, Amazon.com (NASDAQ: AMZN) announced some telling metrics on its Fulfillment by Amazon (FBA) service, or Amazon's service that stores, picks, packs, and ships third-party seller's products in its fulfillment centers, as well as provides customer service on behalf of the seller.
FBA is "thriving," Amazon said. FBA items shipped worldwide during the holidays increased 50%, highlighting the growing popularity of the service. To understand just how strong this growth rate is, consider that eBay's (NASDAQ: EBAY) year-over-year growth in sold items on its platform was just 5% in the company's most recently reported quarter. And eBay's marketplace revenue in the company's most recent quarter was up just 2% year over year. The big difference in the two company's recent growth clearly shows how hot FBA is with sellers right now.
Further, Amazon said active sellers using FBA increased an impressive 70% during 2016. And the service is particularly taking off outside of the U.S., where FBA units shipped increased over 80% last year.
Does it matter?
With Amazon's e-commerce ambitions spanning far beyond theproducts it can produce, market, and sell itself, the fact that FBA is firing on all cylinders is good for Amazon investors. Not only does this data validate how sellers are increasingly relying on the program, but it also points to a growth opportunity for Amazon.
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