Amazon.com delivered results beating expectations for the second consecutive quarter amid dismal retail environment. The surprising part is that Amazon managed to generate profit without offering price discounts.
Amazon is benefiting from the major shift to online purchase and the calculated shopping behavior that consumers are showing during this economic downturn. The wide range of products it offers by independent merchants and its expansion into new categories with low-priced shipping in the United States and abroad continues to attract shoppers.
First Quarter revenue results last year --------------------- $4.13 Billion
First Quarter revenue results this year --------------------- $4.89 Billion
Amazon surpassed the 15% growth expected by the analysts. The company generated net income of 41% a share for the quarter which is 10% higher than the analysts' average forecast.
Amazon showed unexpected growth in its domestic sales of books, CDs and other media as well as strong demand for electronics. Analysts say that its most likely benefiting from the departure of its competitor - Circuit City.
Analysts also say that Amazon is continually stealing the market share from its rival eBay. ComScore's data also confirms this trend. Amazon had 61 million visitors in March which is up from 50 million a year ago. EBay on the other hand lured 70 million visitors which is down from 80.1 million.
--------