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Amazon Q1 Profits Fall 35%

4/26/2012 05:01:13 PM Eastern
Seattle - Amazon.com reported double-digit declines in its first quarter profits and operating income.
Earnings dropped 35 percent to $130 million for the three months, ended March 31, while operating income fell 40 percent to $192 million. The declines reflect the company's continued investment in infrastructure, operations, video content and customer service, and Wall Street rewarded the better-than-expected results with double-digit share price gains in after-hours trading.

"We're adding a lot of resources," chief financial officer Tom Szkutak said during a conference call.

Conversely, net sales rose 34 percent to $13.2 billion.
 North America segment sales, representing the company's U.S. and Canadian sites, increased 36 percent to $7.4 billion, while operating income rose 20.3 percent to $349 million.
Sales of electronics and other general merchandise in North America rose 44.5 percent to nearly $4.8 billion, or 65 percent of the merchandise mix. Media sales rose 15.8 percent to $2.2 billion, representing 30 percent of the merchandise mix.
The company said the Kindle Fire remains its best-selling product and that nine out of 10 of its top first-quarter sellers were digital products, including Kindle, Kindle books, movies, music and apps.

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