Internet retailer Amazon.com last night reported its first quarterly profit outside the holiday season as free shipping incentives and a new sporting goods store helped to swell revenue 33 per cent.
The company said sales in its current quarter, the biggest of the year, could top Wall Street expectations but forecast 2004 revenue roughly in line with prevailing analyst forecasts.
Shares in Amazon, which have more than tripled this year in a rally that some analysts warn has left the company overvalued, slipped just over 2 per cent in after-hours trade.
Amazon reported a third-quarter net profit of $16 million, or 4 cents per share, compared with a loss of $35 million, or 9 cents per share, a year earlier.
Including the past two holiday quarters, this marked Amazon's third quarter of net profitability since it went public in 1997.
"Our strategy of lowering prices is benefiting customers and our business performance," Amazon's chief financial officer Mr Tom Szkutak told reporters.
Cheered by growing revenues at the Seattle-based web retailer, investors sent Amazon's stock price soaring since July last year, despite analysts' warnings that the stock is becoming overvalued.
Excluding stock-based compensation, amortization and other charges, Amazon said it earned a profit of $48 million, or 11 cents per share in the latest period.
Amazon shares slipped 2 percent to $57.91 in after-hours trade, compared with their Nasdaq close of $59.35, as investors turned their attention toward the web retailer's forecasts.
Third-quarter revenue rose to $1.1 billion from $851 million a year earlier. So far this year, Amazon has posted more than $1 billion in revenue every quarter, another first for the company.
For the fourth quarter, which is Amazon's most important because of the holiday and year-end buying season, the company is expecting revenue of $1.76 billion to $1.91 billion.