- Amazon.com has reported that last quarter's sales will be more than US$960 million, a 40 percent increase over the same period in 1999. The online retailer attributed much of the increase to growth in sales in areas other than books, one of the company's core products.
"This holiday season, customers purchased record amounts from our electronics, kitchen and tools stores," said Amazon CEO Jeff Bezos. "More than 35 percent of U.S. customers made purchases during the quarter from a store other than books, music or DVD/video. And, for the second quarter in a row, the electronics store was the second-largest U.S. store, behind books."
The online retailer still reported an operating loss of 7 percent of net sales, compared with 1999's loss of 26 percent in the fourth quarter.
Though the improvements are promising, revenues for the Seattle-based Internet retailer came in at the low end of expectations for the holiday season, and the company has not yet seen a profit, said analyst Barrett Ladd at Gomez Advisors Inc. in Waltham, Mass.
Ladd said the combination of the slowing economy and the fact that investors' are taking a hard line on online-only retailers that fail to show a profit will make it difficult for Amazon this year.
"Those are not good circumstances for any e-tailer," she said.
Amazon's brand recognition and infrastructure are strong points in its favor and keep the company viable despite the obstacles, said Ladd.
"We're pleased that during a period of broad softening in consumer spending, we delivered sales within our guidance, and at the same time met our bottom-line objectives," said Warren Jenson, Amazon's chief financial officer. "We expect to report an inventory balance for year-end of less than $175 million, while also reporting an increase in gross profit of over 140 percent. We're entering 2001 in a solid financial position with approximately $1.1 billion in cash and marketable securities."