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Amazon posts 37 percent sales increase

Apr. 24, 2008

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After the markets closed yesterday, online book seller said its first-quarter profit grew 29.1 percent, helped by strong sales in the U.S. and overseas. The numbers are higher than what Wall Street analysts had expected.

Overall, Amazon's quarterly earnings climbed to $143 million, or 34 cents per share, from $111 million, or 26 cents per share, in the 2007 corresponding period.

However, lower operating income guidance for the full fiscal year also helped pushed shares down $4.33, or 5.4 percent, to $76.67 in after-hours trading. Amazon's stock had closed up $1.40 at $81 in normal-day trading today.

Analysts surveyed by Thomson Financial had forecast a profit of about 31 to 32 cents per share.

The book seller's revenue increased 37 percent to $4.14 billion from $3.02 billion for 2007's 1st quarter. Sales in North America grew a little over 30.92 percent to $2.13 billion from a year ago.

Overall, international sales rose about 44 percent to $2.01 billion, and accounted for less than 50 percent of total revenue, up from 46 percent for 2007.

For the year, forecast $19.1 billion to $20.0 billion in revenue, close to Wall Street's current estimate of $19.29 billion.

The online retailer said it expects sales between $3.86 billion and $4.08 billion for the current quarter. Analysts are looking for $3.84 billion, so it will be interesting to see how high the numbers will come out for the second quarter.

In a conference call late today, Chief Financial Officer Tom Szkutak explained that some numbers were depressed by stock option expenses and various costs associated with the acquisition of audio book company

Szkutak was quick to point out that the numbers didn't reflect expected changes in company performance however.

In January, Amazon's operating income guidance for 2008 - $740 million to $940 million - came in about $45 million lower on both ends than the company's forecast.

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