Amazon.com Inc. shares fell following a report that the e-commerce giant adjusted its product search results to emphasize items that are more profitable to the company.
The Wall Street Journal reported Monday that, following an internal debate, Amazon late last year changed its secret algorithm that ranks search results to lift more profitable items, a departure for a company that typically emphasized customer satisfaction and bestsellers.
Digital giants including Amazon, Apple, Google and Facebook are under scrutiny for how they govern their sprawling online platforms. Critics of the companies have accused each of favoring their own products over those of rivals, potentially stifling competition.
The change to the search algorithm could steer customers toward Amazon private-label products that deliver higher profit margins than competing listings, the Journal reported.
Amazon shares fell 1.9% to $1,804 at 11:38 a.m. The company didn’t immediately respond to requests for comment. A spokeswoman told the Journal that Amazon has long considered long-term profitability, but that it didn’t make decisions based solely on that metric.
Bloomberg reported last week that a team of Federal Trade Commission investigators has begun interviewing small businesses that sell products on Amazon to determine whether the e-commerce giant is using its market power to hurt competition. A House panel investigating big tech companies for potential antitrust violations is seeking information from customers of Amazon, Apple, Google and Facebook about the state of competition in digital markets and the adequacy of existing enforcement, Bloomberg reported on Sunday.