Amazon Announces Good Third Quarter Results
Amazon recently reported their best ever Q3 figures. Net income grew to $199 million – a 70% increase on the same period last year. Revenues and profits both exceeded expectations and a strong fourth quarter is now expected. Following the announcement the Amazon share price rose by 27% based on the expectation that they will shortly become the dominant internet retail outlet source.
A major factor in Amazon’s success has surely been the Amazon Kindle e-book reader. The Kindle was originally launched in November of 2007. Now in its second generation, it has gained a 60% share of the US e-book reader market. After a long wait, Amazon has commenced shipping the Kindle 2 reader to over 100 different countries worldwide. A second price drop since the launch accompanied the announcement of international shipping.
This was followed, a mere two weeks later, by a further price drop and a consolidation of a single Kindle 2 reader – the Kindle international version, which now retails for $ 260. This was seen by many as a response to the announcement by Barnes and Noble of their own new “Nook” e-book reader (which also retails for which also retails for $260). Nevertheless, the focus and consolidation on the huge global market makes perfect sense for a variety of business reasons.
Apple, Sony, Asus and Apple all have new e-book readers in various stages of development. The e-book market may be relatively new, but it is changing and growing at exponential speed. Considering the domination of Amazon thus far, and the fact that the Kindle is now their number one selling product, it seems unlikely that Amazon will rest on its laurels and watch other manufacturers speed by it (just as Amazon themselves leapfrogged Sony a couple of years ago).
In any event, Amazon have plenty of other tricks up their corporate sleeve. They have seen strong growth in Amazon Prime mebership – which offers enhanced delivery options for an annual payment. This growth was especially strong in international areas.
A spokesman for Amazon said that Amazon would continue to grow its product range and look to expand its business geographically over time.
Sales between $ 8.13 billion and $ 9.13 billion are now being forecast for Q4.
Learn more about the Amazon Kindle reader.
