Amazon.com on Thursday posted a 9% increase in fourth-quarter net income as the Internet giant’s aggressive pricing led to strong sales in a dismal economy.
Amazon’s better-than-expected Q4 revenue and earnings, along with a strong sales outlook for the current first quarter and a better than expected holiday shopping season, helped boost shares 12% in extended-hours trading to $56.49.
For the quarter that ended on Dec. 31, Amazon’s net profit rose 9 percent , to $225 million, or 52 cents a share, up from $207 million, or 48 cents, in the same quarter last year.
Net sales grew 18% to $6.7 billion. Amazon said sales would have grown 24% if not for an unfavorable currency exchange rate.
CEO and founder of Amazon.com Jeff Bezos stated, “We remain relentlessly focused on serving customers with low prices, great selection and free shipping offers, including Amazon Prime.”
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Earnings backed up Amazon’s claim a few weeks ago of having it’s “best ever” holiday season and that the online mega-retailer is not being seriously hurt by cutbacks in consumer spending and the tragic economy. Free shipping, lower prices and an expanded product line has helped Amazon gain market share from other online retailers during tough times.
Sales of items like books, CDs and DVDs climbed 9 percent to $3.64 billion, and sales of electronics and other merchandise rose 31 percent to $2.89 billion.
Amazon also said it made 45,000 additional book titles available for its revolutionary and ever-popular wireless electronic reading device, the Kindle, for a total of 230,000. The company has also hinted at a new updated Kindle 2.0 set to be released any day now.
