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Amazon profits dip

Margin pressure

For Sale sign detail

Bookseller Amazon.com saw profits fall in the third quarter despite increasing sales.

The company made sales of $2.31bn in the third quarter ended 30 September 2006 - up 24 per cent on the same period last year. But net income was down to $19m compared with $30m in the third quarter of 2005.

US sales were up 21 per cent to $1.26bn with China, France, Germany, Japan and the UK bringing in $1.05bn - up 29 per cent on the same period last year.

Worldwide sales of electronic and general goods rose 43 per cent to $699m or 30 per cent of worldwide net sales.

Amazon Prime, the company's loyalty scheme which gets you free shipping in exchange for a fixed annual fee, also showed good sequential growth.

The company made strong predictions for the crucial Christmas season - it expects net sales between $3.625bn and $3.950bn and to bring in operating income of between $145m and $235m.

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