Amazon Posts First Net Profit

23 January 2002

What does it take to make a dotcom profitable? About six years and $3 billion of investment judging by, which on Tuesday said it had finally edged into the black.

For the fourth quarter of last year, the e-tailer chalked up $5.1 million in net profit, up from a $545m shortfall a year before, as sales topped the $1bn mark for the first time. Not only that, the group’s British and German units also became profitable in the three-month period.

Other online firms have claimed profits before, but these usually reflect accounting trickery, such as excluding interest and goodwill. Amazon’s profit, however, involved no such exclusions.

The group’s market valuation jumped $800m on the news to $4.6m. Nevertheless, Amazon also warned that it would temporarily fall back into the red this year.

News source: The Times (London)