Hi Bald Eagle - interesting article about AMZN today:
Regards,
Phil
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Amazon.com Says Its Sales Surged,
But It Doesn't See a Narrower Loss
An INTERACTIVE JOURNAL News Roundup
Amazon.com Inc. said its sales surged to $250 million in the fourth quarter, nearly four times the level it reported a year earlier, but the online bookseller said it doesn't expect the stronger sales to translate into a stronger bottom line.
The Seattle company, considered a bellwether in Internet retailing, blamed the lack of improvement at the bottom line on aggressive price cutting and the large role that music and video sales played in the quarter's overall sales tally. Those products offer slim profit margins.
Higher expenses incurred on fulfillment -- the process of getting ordered products into the hands of customers -- also hampered its ability to move toward profitability. Amazon said it made an "all-out push" to fill customers' orders as its business surged during the holiday period.
The company didn't make a specific projection for its losses. In the year-ago quarter, it posted a loss of $9.3 million, or about 20 cents a share as adjusted for a 2-for-1 stock split in June, on sales of $66.1 million. Amazon expects to report its latest fourth-quarter earnings in late January.
In a statement released early Tuesday, Amazon said, "higher seasonal sales will not translate into correspondingly lower net losses in the fourth quarter." Bill Curry, a spokesman for the company, said he couldn't be more specific about the company's expectations for its bottom line, and he wouldn't comment on analysts' projections for the period.
Analysts surveyed by First Call have forecast a loss of about 54 cents a share for the fourth quarter.
Amazon shares skidded in early trading on Tuesday, dropping $9.0625 to
$109.24 on the Nasdaq Stock Market. The company recently declared another split, this time 3 for 1, and its stock price was adjusted to reflect that split beginning on Tuesday.
Amazon said activity was hot during the holiday season -- between Nov. 17 and Dec. 31. During that time, it said it logged 1 million new customers, and shipped more than 7.5 million items. In terms of shipping products, Amazon said it hit a peak of $6 billion on one day. |
