Amazon profits hit by increased competition
Amazon, the online bookseller, last night unveiled a $30m (£16.8m) profit for the third quarter.
Some of the gloss was taken off increased sales, however, as it admitted that a patent dispute had cost it $20m. Seattle-based Amazon made a one-off payment to settle a patent lawsuit in the third quarter. Its profit, otherwise, would have been $50m. That would still have been $4m less than profits for the same period in 2004. Shares in the retailer fell 1.62 per cent in early trading in America to $46.17.
However the company was still painting an upbeat picture of trading saying that sales in North America including Canada had topped $1bn in a rise of 28 per cent. The international businesses, which includes Amazon.co.uk, leapt 26 per cent to $817m.
Not only is the company selling books by the lorry load, it has also been making inroads in the electronics and other general merchandise markets. That includes sales of iPods and digital cameras which helped sales soar in the newer division by 43 per cent.
Ryan Regan, acting managing director in Britain, said: “We are happy with growth across all our product lines, but especially our newer categories like computer electronics, home and gardens and toys.” The company opened a new distribution centre in Scotland to aid supply of such merchandise.
“Heading into the festive period, we think we are going to have our biggest Christmas ever,” he said.