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Amazon’s First-Quarter Revenue Tops Estimates on Kindle Sales

26 April 2012

From Bloomberg:

Amazon.com Inc., the world’s largest Internet retailer, beat analysts’ first-quarter revenue estimates, led by demand for Kindle devices and a jump in sales for outside vendors through its website.

Net income fell to $130 million, or 28 cents a share, from $201 million, or 44 cents, a year earlier, the Seattle-based company said today in a statement. Sales rose 34 percent to $13.2 billion, compared with the average analyst estimate of $12.9 billion, according to data compiled by Bloomberg.

Chief Executive Officer Jeff Bezos is looking to add customers by pouring money into new versions of the Kindle and warehouses that are equipped to send out products faster. The Kindle Fire tablet is the best-selling item on Amazon’s site, the company said. In the fourth quarter, the company shipped 4.7 million Kindle Fires, giving it 16.8 percent of the market and making it No. 2 behind Apple Inc.’s iPad, according to IDC.

. . . .

To bolster profitability, the company is adding more third- party sellers, which generate higher margins, to its website. Amazon logs all of the commission, usually about 10 percent, on any item sold by an outside vendor as profit, and collects fees if the partner elects to fulfill through its chain of warehouses, according to Mercent Corp., a consulting firm that helps retailers improve online sales.

Link to the rest at Bloomberg


3 Comments to “Amazon’s First-Quarter Revenue Tops Estimates on Kindle Sales”

  1. “warehouses that are equipped to send out products faster.”

    If they can get it to me in 2 hours, I’m doing all my grocery shopping at Amazon.

    • Well, they don’t quite make two hours, but I am doing 90% of my grocery shopping at Amazon. I usually place my grocery order at night, and have my groceries on my doorstep the next morning! (You have to live in the Seattle area, though.)

  2. I’m already having cat food, kitty litter (a special system) and carpet cleaning supplies delivered to the office by Amazon using their subscription system. I started in 2010 and quickly figured out this was saving me a lot of trips to that other bugbear, Wal-mart. Plus they had an organic carpet cleaner that smells like bergamot and sage. I don’t really care about the organic part (although if given a choice I will do earth friendly things), but I love the smell.

    I would definitely give their shopping service a try if it was available locally. I also know a number of older people who would be interested in this– one convenient and well stocked chain grocery store in particular has developed a problem with purse snatching in the parking area that makes people wary of going there.

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