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Amazon's Q2 Sales Up, Profits Down

7/23/2009 06:14:12 PM Eastern

Seattle -
reported a 14 percent increase in net sales to $4.7 billion for its second
quarter, ended June 30, while net income fell 10 percent to $142 million.

Excluding the
unfavorable impact of foreign exchange rates, net sales would have grown 20
percent, the online retailer said.

Within North America, sales of electronics and other general
merchandise grew 29 percent to $1.2 billion, while net sales increased 35
percent to nearly $2.2 billion.

"We're staying
heads-down focused on providing customers low prices, vast selection and fast
delivery," said founder/CEO Jeff Bezos, who emphasized the $900 million in
savings realized by customer who participated in the company's free shipping

The results came
in below Wall Street's projections, causing Amazon's share price to fall in
late-day trading. Analysts said the company sacrificed profits for sales
growth, as aggressive pricing cut into margins, although Amazon attributed the
earnings shortfall to a $51 million settlement payment to Toys "R" Us over a
longstanding breech of contract suit.

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