DOW JONES NEWSWIRES
Amazon.com Inc.'s (AMZN) first-quarter net income grew 24% on
higher sales and margins, highlighted by the Kindle electronic
bookreader, with Chief Executive Jeff Bezos expressing gratefulness
"that Kindle sales have exceeded our most optimistic
expectations."
But shares fell 1.5% to $79.99 in after-hours trading despite
the online retail giant's results topping Wall Street's
expectations. Its second-quarter revenue view was merely in line
with analysts' estimate. Amazon.com's stock has gained 57% this
year - vastly outpacing the rest of the market.
The Kindle 2 electronic reader has been popular, with one
analyst estimating one million will be sold this year. Amazon.com
doesn't disclose sales figures for Kindle.
Amazon.com's overall sales have been rising as more people shop
online, some brick-and-mortar stores close and it offers additional
product categories. But analysts continue to worry that the
company's ultra-low prices and services, such as free shipping,
will hurt its margins and bottom line.
Amazon.com reported net income of $177 million, or 41 cents a
share, up from $143 million, or 34 cents a share, a year earlier.
Revenue climbed 18% to $4.89 billion. Excluding currency
fluctuations, the increase would have been 25%.
Analysts' estimates were for per-share earnings of 31 cents on
revenue of $4.76 billion, according to a poll by Thomson
Reuters.
Gross margins rose to 23.5% from 23.1%.
In addition to e-commerce, Amazon.com has become a formidable
competitor to online auction site eBay Inc. (EBAY) in the market
for third-party sales. Amazon.com doesn't break out specific
revenue for this part of its business but noted that items shipped
on behalf of sellers who used the company's "Fulfillment by Amazon"
service to handle their goods quadrupled from a year earlier.
Looking ahead, Amazon.com expects second-quarter revenue of $4.3
billion to $4.75 billion. Analysts estimated $4.61 billion.
-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975;
Kathy.Shwiff@dowjones.com