Kindle e-book reader helps Amazon sales to hot up
Despite the upbeat performance, the US firm's Nasdaq-quoted shares fell in yesterday's early trading after Amazon predicted its fourth-quarter growth would come short of market expectations.
In particular, Amazon has stepped up its use of television commercials to promote the Kindle, which is now available in a thinner wi-fi version that is cheaper than its predecessor run over mobile phone networks. The company is also spending more on its recently-acquired Zappos.com shoe site, while expanding warehousing space to handle its growing lines of clothing and large electrical items.
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Hide AdRevenues during the third quarter rose by 39 per cent to $7.56 billion (4.82bn). Net income was 16 per cent higher at $231m, up from $199m a year earlier. For the final three months of the year, Amazon is predicting operating income of between $360m and $560m. Analysts had previously been anticipating fourth-quarter operating profit in the region of $620m.
Amazon doesn't disclose Kindle sales, but analysts estimate the ereader will generate $2.8bn in revenues this year for the company. That is expected to rise to $5.3bn in the following 12 months.