Amazon’s Q3 net income shoots up 321%
Some online retailers cite weaker consumer confidence and other economic conditions as reasons for softer sales in the third quarter, but Amazon.com just keeps pushing ahead.
In the third quarter Amazon.com, No. 1 in the Internet Retailer Top 500 Guide, recorded hefty gains in sales and net income. For the quarter sales grew year over year by 41% to $3.26 billion from $2.31 billion while net income jumped by 321% to $80 million from $19 million.
“With our ever-increasing selection, customers are now getting this unusual level of service across many different product categories and with depth of selection in each category,” says Amazon CEO Jeff Bezos. “In our view, putting customers first is the only reliable way to create lasting value for shareowners.”
Amazon’s worldwide electronics and other general merchandise grew 42.7% to $1.08 billion in Q3 from $757 million in the prior year and increased to 33% of worldwide net sales compared with 30% in the third quarter of 2006, the retailer says. North America segment sales, which include Amazon’s U.S. and Canadian sites, totaled $1.79 billion, up 43% from $1.25 billion in the third quarter of 2006.
International sales also were stronger. For the quarter overseas sales from Amazon’s e-commerce sites in the United Kingdom, Germany, Japan, France and China totaled $1.47 billion, up 47% from $1 billion in the second quarter of 2006.
Amazon in Q3 saw a healthy increase in sales and a big jump in net income because the company continues to diversify, Bezos says. For instance, the online retailer’s book store has sold 2.5 million copies of “Harry Potter and the Deathly Hallows” worldwide, making it Amazon’s largest new product release. In the third quarter Amazon launched Amazon MP3, a digital music store featuring more than 2 million songs from over 180,000 artists.
Amazon also increased its spending on sales and marketing, fulfillment, and content and technology in the last quarter. Q3 spending on fulfillment rose by 36.4% to $296 million from $217 million, while content and technology expenses increased 21.5% to $209 million from $172 million. Marketing and advertising expenditures grew to $74 million from $64 million, an increase of 15.6%.
Amazon is anticipating that fourth quarter web sales will range from $5.1 billion to $5.5 billion and between $14.2 billion and $14.6 billion for the year.
Back...
