INTERNET giant Amazon last night announced quarterly earnings that exceeded even the most optimistic expectations, sending its stock up 15 per cent in after-hours trading.
Shares in the company leapt to $225 (£138) each – a valuation of more than 70 times earnings – even though net income fell from $201m to $130m on a like-for-like basis.
But investors were attracted by first-quarter revenue of $13.18bn, an increase of 34 per cent from the first three months of 2011.
“This looks like a quarter that has something for everyone, growth and margins to satisfy investors. This was a perfect balance. It looks to me there was a follow-through for the Kindle and Kindle Fire in the re-acceleration of growth in media,” said Stifel Nicolaus analyst Jordan Rohan.
Amazon has pursued a policy of heavy investment in new product lines, building vast new warehouses and is thought to be selling its tablet computer Kindle Fire at a loss in an attempt to build market share.
The company does not disclose sales figures for its products but did say that revenues at the firm’s media business – which includes content sold for Kindle devices – increased 19 per cent in the first quarter of 2012.