Amazon has yet to find a scalable brick-and-mortar grocery format, almost six years after acquiring Whole Foods Market, according to a letter from Andy Jassy, President and CEO of Amazon. Jassy stated that the company is still searching for a mass grocery format that it believes is worth expanding broadly, and that Amazon Fresh is the brand that has been experimented with for a few years. The company took a \$720 million impairment charge in the fourth quarter of fiscal 2022 due to its physical Amazon Fresh and Amazon Go store formats. Amazon is working to identify and build the right mass grocery format for Amazon scale, continuously refining its store formats to find ones that resonate with customers and will build the grocery brand. Is Amazon Fresh being discontinued?  The company has decided not to expand its physical Fresh doors until it finds the differentiation and economic value equation that it likes, but is optimistic that it will find it in 2023.

Meanwhile, Walmart announced at its April 5 investor day conference that its omnichannel capabilities, which it has invested in over the past decade, have set the company up for a new phase of growth. Walmart's CFO, David Rainey, stated that the investments the company has made have positioned it well and could generate steady and sustained growth at higher margins. Achieving the company's targeted 4% sales growth over the next five years would add more than \$130 billion of sales on top of its roughly \$600 billion base today. Jassy emphasized during a February conference call with securities analysts that when Amazon's digital and physical grocery businesses are combined, the company has a significant footprint in the market. However, delivering perishables to consumers at a greater scale than Whole Foods remains a challenge for the company.

Is Amazon Fresh being discontinued?