Tech and Web NEWS

Jeff Bezos Smile: Amazon shames eBay, Profits Amid Recession

By Amarendra Bhushan for CEOWORLD Magazine Updated:April 24, 2009

Amazon.com Inc., the world’s biggest Internet retailer, reported first-quarter sales and profit that beat analysts’ estimates, bolstered by free shipping offers and demand for the Kindle electronic-book reader.

During the first three months of the year, Amazon sales reached $4.9bn, a 18 per cent leap from the same quarter last year. And if you ignore the impact of inconvenient currency exchange rates, you can argue a 25 per cent revenue climb. That translates to quarterly profits of $177m, a 24 per jump from early 2008.

Sales in North America and Canada were up 21 percent to $2.58 billion from last year. Global sales of electronics and other general merchandise sales were up 38 percent to $2.05 billion.

Many users were taking advantage of the third-party sellers on the site. Items shipped on behalf of that program were up more than 300 percent from last year, Amazon said.

Highlights

* Amazon.com introduced Kindle 2, the new reading device that offers Kindle’s revolutionary wireless delivery of content in a new slim design with longer battery life, faster page turns, a crisper display, and over seven times more storage. The Kindle Store offers more than 270,000 books, including 104 of 112 New York Times Best Sellers, plus top U.S. and international newspapers and magazines.

* The Company launched “Kindle for iPhone and iPod touch,” a free application that allows customers to enjoy Kindle titles on the iPhone and iPod touch. Amazon’s Whispersync technology saves and synchronizes customers’ bookmarks across their original Kindle, Kindle 2, iPhone and iPod touch.

* Amazon Web Services (AWS) announced the public beta of Amazon Elastic MapReduce. Utilizing a hosted Hadoop framework, this new service enables businesses, researchers, data analysts and developers to easily and cost-effectively process vast amounts of data using Amazon Elastic Compute Cloud (Amazon EC2) and Amazon Simple Storage Service (Amazon S3).

* AWS introduced Reserved Instances, an additional pricing option for Amazon EC2 that gives developers the opportunity to make a low, one-time payment to reserve capacity and further reduce hourly usage charges.

* AWS and IBM announced a relationship that will allow developers to run some of IBM’s most popular software on top of Amazon EC2. Customers can pay by the hour for the software, bring their own existing licenses with no additional software fee, or use free versions in the cloud for development and test purposes.

* North America segment sales, representing the Company’s U.S. and Canadian sites, were $2.58 billion, up 21% from first quarter 2008.

* International segment sales, representing the Company’s U.K., German, Japanese, French and Chinese sites, were $2.31 billion, up 15% from first quarter 2008. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, International sales grew 28%.

* Worldwide Media sales grew 7% to $2.72 billion, compared with $2.54 billion in first quarter 2008.

* Worldwide Electronics & 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%.

* Items shipped on behalf of sellers who utilized Fulfillment by Amazon increased by more than 300% from the prior year.

* The Company launched its latest mobile application, “Amazon App for BlackBerry.” Available for free download on any BlackBerry with a track ball, the application offers customers a quick and simple way to find, discover and buy products on Amazon.com.

* Amazon launched its MP3 music service in Germany, offering more than 5 million DRM-free songs from all four major labels and hundreds of independent labels that can be played on any MP3 player.

* Amazon.com’s Video Game store beta-launched the Amazon Video Games Trade-In service, allowing customers to receive an Amazon.com Gift Card in exchange for eligible video games.

Operating cash flow was $1.76 billion for the trailing twelve months, compared with $1.04 billion for the trailing twelve months ended March 31, 2008. Free cash flow increased 82% to $1.43 billion for the trailing twelve months, compared with $0.79 billion for the trailing twelve months ended March 31, 2008.

Common shares outstanding plus shares underlying stock-based awards outstanding totaled 447 million on March 31, 2009, compared with 435 million a year ago.

Net sales increased 18% to $4.89 billion in the first quarter, compared with $4.13 billion in first quarter 2008. Excluding the $268 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales would have grown 25% compared with 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.

Net income increased 24% to $177 million in the first quarter, or $0.41 per diluted share, compared with net income of $143 million, or $0.34 per diluted share, in first quarter 2008.

“We’re grateful and excited that Kindle sales have exceeded our most optimistic expectations,” said Jeff Bezos, founder and CEO of Amazon.com.

Like this article! ‹ Microsoft Profit Falls for First Time in 23 Years:profit drops 32%, revenues down 6% Facebook&amp;amp;amp;amp;#039;s Van Natta to be named MySpace CEO ›
Share this Post: Get It Delivered To Your Inbox