P&L

Amazon’s profits grew faster than its revenues, again. And investors hate it

January 30, 2014
January 30, 2014

Amazon-quarterly-sales-growth-Sales_chartbuilder

The numbers: The Godzilla of retail had another double-digit quarter of revenue growth, with sales up 20% to $25.59 billion. This flowed through to the bottom line, and then some. Net income was $239 million, more than double its total for the same quarter in the previous year. Yet the results were still weaker than expected, and shares in Amazon dropped roughly 10% in post market-trading.

The takeaway: Double-digit revenue growth isn’t good enough for Amazon. This was the slowest quarter of revenue growth for the company since 2009. Still, the profit growth relative to revenues represents a big turnaround for the company. Investors have long griped about Amazon’s skimpy profit margins, as it invested its growing revenues into expansion instead.

What’s interesting: On Christmas Day, the average response time when a customer tapped the Mayday button on the Kindle Fire (a function that transports a user to live video tech support) was just 9 seconds, faster than the response time goal of 15 seconds, the company said.

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