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Amazon’s Q2 Sales, Profits Soar

7/26/2004 09:04:00 AM Eastern

Seattle — Amazon.com posted healthy sales and earnings gains for its second quarter, ended June 30, which it attributed to its free shipping offer and lowered pricing.

Net sales climbed 26 percent over the year-ago period to $1.4 billion, while net income was $76.5 million, compared to a year-ago net loss of $43.3 million.

“Worldwide adoption of our everyday free shipping offer” — good on orders over $25 — “reached another record high point this quarter,” said founder/CEO Jeff Bezos. Amazon will keep the offer in place indefinitely despite its high cost to the company, he said, while continuing to lower prices across its product assortment.

Broken out by segment, North American sales, representing the e-tailer’s U.S. and Canadian sites, grew 13 percent to $792 million for the quarter, while operating income increased 21 percent to $65.9 million. Within that region, net sales of the catch-all “electronics and other general merchandise” category, which excludes books, music, movies and video game consoles and software, increased 27 percent to $225.8 million.

The category garnered $1.4 billion in sales worldwide, representing 23 percent of Amazon’s total revenue for the quarter.

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