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Amazon reports fast-growing sales as ebooks take off – and a bottom-line loss

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Amazon reports fast-growing sales as ebooks take off – and a bottom-line loss
Amazon reports fast-growing sales as ebooks take off – and a bottom-line loss
Amazon has reported sales up by more than a quarter in 2012, after a year in which sales of digital ebooks grew quickly.

The company, releasing fourth quarter and full-year sales figures, said net sales were up by 27% to $61.09bn (£38.6bn) in the year to the end of January, compared to $48.08bn (£30.4bn) in 2011. Sales of e-books rose by 70% during the year while sales of physical books were up by just single digits.

“We’re now seeing the transition we’ve been expecting,” said Jeff Bezos, founder and chief executive of Amazon.com. “After five years, eBooks is a multi-billion dollar category for us and growing fast – up approximately 70% last year. In contrast, our physical book sales experienced the lowest December growth rate in our 17 years as a book seller, up just 5%. We're excited and very grateful to our customers for their response to Kindle and our ever expanding ecosystem and selection.”

But operating income was down by 22% to $676m (£427.7m), from $862m (£545.5m) in 2011, taking the company to a full-year loss of $39m (£24.7m), from net income of $631m (£399.3m) in 2011. In the fourth quarter of the year, to December 31, net sales rose by 22% to $21.27bn (£13.4bn) from $17.43bn (£11.0bn) in the fourth quarter of 2011. Operating income rose by 56%, compared to the previous year, to $405m (£256.3m) in the quarter, while net income fell by 45% to $97m (£61.4m).

The company said that its Kindle Fire tablet was its bestselling product for the second year in a row across all its markets, including the UK. During the last quarter the company launched Kindle Stores in Brazil, Canada, China and Japan. Amazon predicted net sales up by between 14% and 26% in the first quarter of 2013.
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