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International sales at Amazon.com slowed in the giant internet retailer's first quarter, according to results released overnight, thanks to the impact of exchange rates and a slowing down of sales growth of its core media products.
Sales at the websites, which include its UK, German, Japanese, French and Chinese sites, rose from $2bn to $2.3bn, representing growth of 15%, or by 28% after excluding currency fluctuations. A year earlier Amazon reported international growth of 44%, or 31% excluding currencies. The international division saw its profitability grow by some 34%, with the unit's operating income recorded as $172m, compared with $128m a year earlier.
Within this unit, media sales grew from $1.3bn to $1.4bn, representing growth of just 6%, compared with growth in the same segment last year of 34%. Growth in media excluding the effect of exchange rates would have been 17% this quarter, compared with 22% a year earlier. Media sales remain the unit's largest product category, though its "electronics and other general merchandise" reported sales growth of 34% this quarter.
Overall, at Amazon.com net sales increased 18% to $4.9bn in the first quarter, compared with $4.1bn in first quarter 2008. Excluding the $268m unfavourable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales would have grown 25% compared with first quarter 2008. Media sales grew by 8% in the US, and by 7% worldwide, the lowest growth of any of Amazon.com's reported categories.
Operating income increased 23% to $244m in the first quarter, compared with $198m in first quarter 2008. Excluding the $32m unfavourable impact from year-over-year changes in foreign exchange rates throughout the quarter, operating income would have grown 39% compared with first quarter 2008.
There was no detail on Amazon.com's Kindle sales, though Jeff Bezos, founder and chief executive of Amazon.com, said: "We’re grateful and excited that Kindle sales have exceeded our most optimistic expectations."
Net sales are expected to be between $4.3bn and $4.75bn in its second quarter, or to grow between 6% and 17% compared with second quarter 2008.