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The BBC's Rory Cellan-Jones
"The one company supposed to be a sure-fire winner"
 real 56k

Tuesday, 24 October, 2000, 21:48 GMT 22:48 UK
Amazon sales soar website boosted by sales of electronics goods
Online retail giant Amazon has hinted it may reach break-even point next year, stunning analysts by reporting sales up 79%.

And the technology sector, rocked by a series of profits warnings earlier this month, was also cheered by better than expected figures from Nortel Networks and Compaq.

Amazon, a leading global e-tail site, announced on Friday that losses had decreased to $68m, or 25 cents per share, in the third quarter of 2000, compared with $79m a year before.

The firm was expected to lose 33 cents a share.

The company might top $1bn in sales in the last quarter of 2000, the firm's results statement said.

Loses to drop

And while warning that sales in the turbulent e-tail market are difficult to predict, it foresaw decreasing operational losses, currently equivalent to 11% of sales.

"Pro forma loss from operations is expected to narrow to less than 5% of sales, perhaps substantially so," the firm said.

Warren Jenson,'s chief financial officer, said: "We are driving towards profitability."

Slow start

The results follow two disappointing quarters for the firm, which boasts more than 25 million customers.

This was a strong quarter for We surpassed our key internal and financial objectives

Warren Jenson,'s chief financial officer

The company reported losses equivalent to 35 cents per share for the first quarter of the year, a performance bettered by only two cents per share over the following three months.

Jason Pontin, editor of the US e-business 'bible' Red Herring, in August branded Amazon a "terrible company".

But, while best known as a retailer of books and compact discs, Amazon credited its improved figures on strong sales of electronic goods, which accounted for six out of 10 of the site's best-selling products in September.

Mr Jenson said: "This was a strong quarter for We surpassed our key internal and financial objectives."

Average sales per customer rose to $130 for the 12 months to the end of September, compared with $108 the year before.

Nortel beats forecasts

Nortel Networks, the world's number two manufacturer of telecoms equipment, posted revenues up 42% to $7.3bn for the third quarter of the year.

Sales of optical networking systems proved particularly strong, up 90% in the quarter over the same period last year.

And the Ontario-based company said it was "especially pleased" by sales of wireless equipment up by more than 50%.

Compaq defies sector slump

Compaq, the world number one personal computer maker, reported net income of $550m for the third quarter, compared with $140m for the same period in 1999.

Michael Capellas, Compaq's chief executive
Michael Capellas, leading Compaq to higer sales

Sales rose 22% to $11.2bn, beating analysts' forecasts by almost $500m.

The figures follow a series of profits warnings from technology firms, including Apple, Intel and Dell.

Telecoms equipment giant Lucent Technologies on Monday reported fourth-quarter profits down 22%, as sales of telephone switching equipment and optical networking systems declined.

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See also:

23 Oct 00 | Business
Lucent profits slump
04 Oct 00 | Business
Dell warns on sales
29 Sep 00 | Business
Apple slump rattles tech sector
22 Sep 00 | Business
Intel shocks high-tech industry
13 Jan 99 | The Company File
Lucent strikes Internet mega-merger
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