Feeds

Amazon profits fall push shares down

Sales up but profits down

The Essential Guide to IT Transformation

Amazon shares fell sharply in after hours trading after the retail giant posted a big drop in profits.

Net sales grew 22 per cent to $2.14bn in the second quarter ended 30 June 2006, but operating income fell 55 per cent to $47m. Changes to accounting for foreign currency made up for $24m of the shortfall.

Amazon CEO Jeff Bezos talked up the shop's membership scheme - Amazon Prime - where users pay $79 for a year's worth of free shipping. Bezos also said investment in technology would slow.

"We're looking forward to the coming decrease in our year-over-year growth rates in technology spending in the second half of 2006."

The US still makes up the bulk of sales - $1.16bn, while the UK, Germany, Japan, France and China sold $982m worth of books.

Amazon started selling groceries during the period - the US site carries 14,000 dry goods. The cost of outbound shipping grew 28 per cent to $188m - the company expects shipping costs to continue to grow.

More details from Amazon here. ®

Boost IT visibility and business value

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Sonos AXES support for Apple's iOS4 and 5
Want to use your iThing? You can't - it's too old
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
The Essential Guide to IT Transformation
ServiceNow discusses three IT transformations that can help CIO's automate IT services to transform IT and the enterprise.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.