Amazon net jumps on strong U.S. sales
July 25, 2007
Amazon net jumps on strong U.S. sales:
Amazon.com Inc. posted quarterly net profit on Tuesday that more than tripled
Why?
Chief Financial Officer Tom Szkutak attributed part of the U.S. sales growth to Amazon Prime, a discount shipping program that charges $79 annually for unlimited two-day shipping.
“Subscribers are increasing, customers are buying more, it’s becoming a more meaningful part of our overall units. It’s certainly impacting the growth you’re seeing this quarter,” Szkutak told reporters during a conference call.
Third-party business represented 30 percent of worldwide sales in the quarter, Amazon said. With these sales, Amazon takes a transaction commission but avoids inventory and fulfillment issues, thereby increasing profit margins.
