Online retailer Amazon.com, Inc. (AMZN) said Thursday after the markets closed that its first quarter profit fell 35% from last year, as higher costs and expenses offset a 34% increase in net sales.
However, the company's quarterly earnings per share breezed past Wall Street expectations as did its quarterly sales.
At the same time, the company gave a down-beat sales forecast for the second quarter and warned of a potential operating loss in the quarter.
Amazon shares are currently gaining 12.49% in after hours trading after closing the day's regular trading session at $195.99, up $1.57. The shares trade in a 52-week range of $166.97 to $246.71. Total operating expenses jumped 37% to $13.0 billion in the first quarter. As a result, operating income for the quarter slipped 40% to $192 million from $322 million last year.
North America segment sales, representing the company's U.S. and Canadian sites, rose 36% to $7.43 billion in the first quarter.
International segment sales, representing the company's U.K., German, Japanese, French, Chinese, Italian and Spanish sites, grew 31% to $5.76 billion.
For the first quarter, worldwide media sales increased 19% to $4.71 billion, while worldwide electronics and other general merchandise sales surged 43% to $7.97 billion.
Amazon said Kindle Fire remains the #1 bestselling, most gifted, and most wished for product across the millions of items available on its Website since its launch in late September. In the first quarter, 9 out of 10 of the top sellers on Amazon.com were digital products - Kindle, Kindle books, movies, music and apps, the company noted.
For the first quarter ended March 31, 2012, the Seattle, Washington-based company reported net income of $130 million or $0.28 per share, compared to $201 million or $0.44 per share for the year-ago quarter.
On average, 34 analysts polled by Thomson Reuters expected the company to earn $0.07 per share for the first quarter.
Net sales for the fourth quarter rose 34% to $13.19 billion from $9.86 billion in the same quarter last year. Thirty-five analysts had a consensus revenue estimate of $12.90 billion for the first quarter.
Looking forward, the company forecast second quarter net sales of $11.9 billion to $13.3 billion, representing a growth of 20% to 34% as compared to the second quarter of 2011. Analysts currently expect the company to post revenue of $12.82 billion for the second quarter.
The company also said it expects second quarter operating results to range between a loss of $260 million and a profit of $40 million. The guidance includes about $260 million for stock-based compensation and amortization of intangible assets.
Last month, Amazon agreed to buy robot maker Kiva Systems Inc. for about $775 million in cash. The deal is expected to close in the second quarter of 2012.
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