The Bookseller.com

20th November 2008

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Sales rocket at Amazon

31.01.08 Anna Richardson

Sales at Amazon.com's international business rose a massive 46% in its fourth-quarter, the group has reported. However, Amazon's share price still fell in after-hours share trading with analysts disappointed by narrowed profit margins.

International sales, representing the company's UK, German, Japanese, French and Chinese sites, were $2.59bn, up 46% from fourth quarter 2006. Excluding the favourable impact from foreign exchange rates throughout the quarter, international sales grew 35%.

The international divisions helped parent Amazon.com increase sales 42% to $5.67bn in the fourth quarter, compared with $3.99bn in 2006. Worldwide Media sales grew 33% to $3.33bn in fourth quarter 2007, compared with $2.5bn a year earlier. Operating income increased 38% to $271m in the fourth quarter, compared with $197m in fourth quarter 2006.

"This quarter showed accelerated sales growth and record operating profits," said Jeff Bezos, founder and c.e.o. of Amazon.com. "In our view, these unusual financial results are driven by one thing: continuously improving the customer experience."

In the full year net sales increased 39% to $14.84bn, or 35%. Operating income increased 69% to $655m.

Amazon issued a higher than expected sales guidance for 2008, predicting first quarter sales to be between $3.95bn and $4.15bn and between $18.75bn and $19.75bn for the full year.

However, according to reports, Amazon's share price slumped during after-hour trading, as analysts picked up on lower than expected gross profit margins, which came in at 20.6% for the fourth quarter, down from last year's 21.3% and below analysts' estimates.

Anna Richardson Amazon.com Amazon.co.uk Jeff Bezos