Digital success boosts Amazon’s sales 34%
Amazon’s quarterly revenue jumped 34%, helped by booming sales of digital products, the online retailer said.
First quarter sales were up by more than a third to $13.8 billion.
Amazon chief financial officer Tom Szkutak told analysts on a conference call that the company was pleased with growth in sales of the digital content, which Kindle ereaders and the Fire tablet are designed to accelerate.
During the first quarter, nine out of ten of the top selling products on Amazon.com were digital products, including Kindle ebooks, movies, music and apps, the company noted.
“One of the concerns with the shift from physical to digital has been whether Amazon will be able to compete,” said Ben Schachter, an analyst at Macquarie. “They’ve done well in ebooks, but now it looks like they’re also doing well in other areas like video.”
North America media revenue – which includes books, DVDs and music – came in at $2.2 billion in the first quarter, up 17% from a year earlier. During the fourth quarter of 2011, this segment grew 8%. The Fire has yet to arrive in the UK.
By the numbers
Amazon reported net income fell to $130 million versus $201 million a year ago, but it still surpassed financial analysts’ expectations.
First-quarter revenue was $13.18 billion, up 34% from a year earlier, while operating income was $192 million, compared with $322 million a year earlier.
“This looks like a quarter that has something for everyone, growth and margins to satisfy investors. This was a perfect balance. It looks to me there was a follow-through for the Kindle and Kindle Fire in the re-acceleration of growth in media,” said Stifel Nicolaus analyst Jordan Rohan.