NEW YORK CITY, New York: Amazon is making a significant push into perishable grocery delivery, allowing Prime subscribers in over 1,000 U.S. cities to receive items like fresh fruit, milk, meat, and frozen dinners on the same day they order.

The expansion is part of the company's bid to compete more aggressively with Walmart+ and Instacart in the high-speed grocery delivery market.

Prime members, who pay US$14.99 a month or $139 annually, can use the service for free on orders over $25. Non-members can access it for a $12.99 fee, regardless of order size. The rollout covers cities including Phoenix, Raleigh, and Tampa, with plans to reach 2,300 U.S. cities by year's end.

Previously, Prime customers ordered perishable groceries through Amazon Fresh or Whole Foods Market, with free delivery requiring an extra $9.99 monthly subscription and a $35 order minimum. Now, fresh and frozen goods will be delivered via Amazon's same-day logistics network under the broader Prime umbrella.

"This marks a major expansion for Amazon's digital grocery service, largely because it's being offered to its massive Prime member base at no additional cost," said Blake Droesch, analyst at eMarketer. Lowering the minimum order threshold to $25 "directly threatens Instacart by enabling customers to use Amazon for quick, one-off purchases."

Brian Mulberry of Zacks Investment Management said the move could boost Prime membership but cautioned that consistent service quality will be key. UBS analyst Stephen Ju added that the lower entry point could pressure margins for Uber Eats and DoorDash.

The market reaction was swift: Amazon shares rose 1.4 percent, while Instacart fell 12.4 percent. DoorDash shares slid 4.8 percent, Kroger dropped 4.2 percent, Walmart fell 2.3 percent, and Uber, parent of Uber Eats, was down 0.8 percent.

The update also aligns with Amazon's $4 billion plan, announced in June, to expand same-day and next-day delivery to more than 4,000 rural communities by year-end. Walmart, meanwhile, has pledged that by the end of this year, it will offer three-hour delivery to 95 percent of the U.S. population.

Amazon's move could intensify competition for smaller grocers. "Amazon shoppers can order milk alongside electronics … and check out with one cart and have everything delivered to their doorstep within hours," said Doug Herrington, CEO of Worldwide Amazon Stores.

While focused on enhancing its U.S. grocery experience, Amazon faces supply chain challenges in the UK, where the Groceries Code Adjudicator recently flagged concerns from suppliers.