With sales up 18% over year ago, Q1 is another strong quarter for Amazon

Amazon.com Inc. continues to defy the market, growing strongly in a tough economic environment. Amazon, No. 1 in the Internet Retailer Top 500 Guide, reported first quarter sales growth of 21% in North America, to $2.58 billion, and 15% internationally, to $2.31 billion. The growth is on top of 25% growth last year, when the overall market grew about 7%, according to the forthcoming Internet Retailer Top 500 Guide.

Combined North American and overseas sales were $4.89 billion, up 18% from $4.13 billion a year earlier. Without the impact of the stronger U.S. dollar, sales would have grown 25%, the company reports.

Q1 net income increased 24% to $177 million versus $143 million in first quarter 2008. Operating income increased 23% to $244 million in the first quarter, compared with $198 million in first quarter 2008. Excluding the $32 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, operating income would have grown 39% compared with first quarter 2008, the company reports.

The company also reported:

• Worldwide media sales grew 7% to $2.72 billion, compared with $2.54 billion in first quarter 2008.
• Worldwide electronics and other general merchandise sales grew 38% to $2.05 billion, compared with $1.48 billion in first quarter 2008, and increased to 42% of worldwide net sales compared with 36% a year earlier.
• Amazon’s continuing offer of free shipping with a low threshold ($25) is having an impact on its bottom line. In Q1, Amazon spent $168 million more to ship packages than it took in: $358 million vs. $190 million. That’s a 31% increase over the $128 million difference last year. Looked at another way, net shipping costs as a percent of net sales was 3.4% in Q1 this year vs. 3.1% in Q1 last year.
• Amazon had $3 billion in cash and marketable securities on hand at the end of Q1 compared to $2.4 billion a year earlier.
• Items shipped on behalf of sellers who utilized Fulfillment by Amazon increased by more than 300% from the prior year.

Larry Maye, liquidations manager at Amazon, is speaking at the Internet Retailer Conference & Exhibition, June 15-18 in Boston, in a session entitled Merchandise returns—managing in tough times.