BBC Homepage World Service Education
BBC Homepagelow graphics version | feedback | help
BBC News Online
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 



Amazon UK's MD Steve Frazier
"You have to keep pleasing customers"
 real 56k

Tuesday, 24 April, 2001, 20:32 GMT 21:32 UK
Amazon reports smaller loss
Jeff Bezos, chief executive, Amazon.com
Bezos appears to be delivering on his profit forecast
The world's leading online retailer Amazon.com on Tuesday reported a much smaller first-quarter loss and said it would report its first quarterly operating profit by the end of the year.

Amazon lost $49m, excluding a wide range of costs, compared with $99m and increased its revenues by 22% to $700m from the same time last year.


We are on track to reach our objective of pro forma operating profitability in the coming December quarter.

Warren Jenson
chief financial officer
Amazon
The results were boosted by strong sales of electronics which offset weak returns in its core books, music and video section, the company said.

"Again this quarter our customers responded with particularly strong purchase levels in our electronics, tools and kitchen stores and from our international sites," chief executive Jeff Bezos said.

The results have helped scotched concerns raised earlier this year that the company may be going out of business.

"We are on track to reach our objective of pro forma operating profitability in the coming December quarter," Warren Jenson, Amazon's chief financial officer, said in a statement.

Amazonshares closed at $15.68 on the Nasdaq, down 52 cents or 3.21%.

Loss warning

The Seattle-based company last week surprised everyone by saying it would post a smaller-than-expected first-quarter net loss.

Last week's forecast helped the stock pull away from year lows of $8.10 but the shares are still far below their year high of $62.38.

Amazon Chief Executive Jeff Bezos has pledged the company will turn a pro forma operating profit, before expenses like interest payments on $2bn in debt, in the fourth quarter.

Dot-bomb benefit

While the recent collapse of other dot-com retailers such as eToys made some wonder if Amazon would be the next to collapse, the company is expected to start benefiting from some of its main competitors being knocked out of the market.

The thinning ranks of the internet retailers has freed up about $1bn in online consumer spending that could go to Amazon, a Goldman Sachs research note has suggested.

It is shutting down a distribution facility in Georgia, partially closing another Seattle center and eliminating most of its Seattle customer service staff, which should translate into savings in the months ahead.

Also down the road will be an online baby store, Babies R Us, run with Toys R Us, which is Amazon's partner in the toy business, and a new partnership announced last week with rival bookseller Borders Group, both of which are expected to add to its revenues.

Search BBC News Online

Advanced search options
Launch console
BBC RADIO NEWS
BBC ONE TV NEWS
WORLD NEWS SUMMARY
PROGRAMMES GUIDE
See also:

11 Apr 01 | Business
Amazon joins forces with Borders
09 Apr 01 | Business
Amazon shares surge 30%
22 Mar 01 | Business
Shareholders sue Amazon
12 Mar 01 | Business
Amazon chief's net stock warning
05 Mar 01 | Business
Amazon surges on Wal-Mart rumour
01 Mar 01 | Business
When will Amazon make a profit?
28 Feb 01 | Business
Amazon shares sink 13%
06 Feb 01 | Business
Bank warns against Amazon bonds
30 Jan 01 | Business
Amazon cuts 15% of its workforce
09 Jan 01 | Business
Amazon pleases Wall Street
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories