By Greg Bensinger
Amazon.com Inc. surprised investors by reporting an unexpected
profit along with its sharp sales gains.
The Seattle online retailer reported a surprising profit of $92
million, up from a year-ago loss of $126 million. Sales rose a
better-than-expected 20% to $23.18 billion.
Shares of Amazon jumped 14% to $550 in after-hours trading.
While Amazon's sales growth has kept investors happy--the stock
is up more than 50% this year--it has slowed in recent quarters. In
the past two years, Amazon was routinely turning revenue gains of
20% or more, but that dipped to about 15% late last year and in
this year's first three months.
The bottom-line losses reflect Amazon's continued investment in
business and services it thinks will yield more sales in the
future. Amazon has been particularly focused on expanding its $99
Prime membership, adding new goodies like free same-day shipping in
some markets.
Amazon reported revenue rose to $23.185 billion from $19.34
billion a year earlier. On a per-share basis, the company's profit
was 19 cents, up from a loss of 27 cents in the year-earlier
period.
Analysts had forecast a loss of 13 cents per share on sales of
$22.4 billion, according to the average of estimates compiled by
Thomson Reuters.
For the third quarter, Amazon said it expects net sales of
between $23.3 billion and $25.5 billion, compared with sales of
$20.6 billion in last year's period.
Write to Greg Bensinger at greg.bensinger@wsj.com
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