Despite recording robust sales, the online books-to-DVDs retailer has suffered a slip in share prices after the results indicated it had implemented a high level of discounting.
Amazon’s fourth quarter sales jumped 42 per cent for the three months to December 31 to US$5.7 billion (£2.87 billion), against US$3.99 billion (£2 billion) in the fourth quarter of 2006.
For the past quarter, sales outside North America – including the UK – rose more than its domestic revenues. The international segment was up 46 per cent to US$2.59 billion (£1.3 billion) compared with the same period in 2006. Sales in the US and Canada rose 40 per cent to US$3.08 billion (£1.55 billion).
Sales from Amazon’s business segment – which includes books, music and films – rose 33 per cent US$3.33 billion (£1.68 billion) worldwide in the quarter. Sales of electricals and general merchandise rose 58 per cent to US$2.21 billion (£1.11 billion).
Fourth quarter gross margin fell from 21.3 per cent to 20.6 per cent year on year. It was 23.4 per cent in the third quarter. Net profits rose 112 per cent to US$207 million (£104.2 million) from US$98 million (£49.3 million) a year ago.
Amazon chief executive Jeff Bezos said he expected sales to reach between US$3.95 billion to US$4.15 billion (£1.99 billion to£2.09 billion) for this quarter, contributing to between US$18.75 billion and US$19.75 billion (£9.43 billion and£9.93 billion) for 2008 as a whole.
He said: “This quarter showed accelerated sales growth and record operating profits. In our view, these unusual financial results are driven by one thing: continuously improving the customer experience."
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