Amazon revenue rises sharply but profits fall

Leading online retailer Amazon.com has posted sharply higher third-quarter revenue, but profits were 44% lower due to a one-time legal settlement for a patent infringement case.

Sales amounted to 1.86 bln dollars, a 27% spike from last year, helped by strong demand for the latest “Harry Potter” book. But the larger sales volume failed to register larger profits as net income declined 44% to 30 mln dollars, as the company was hurt by a 40 mln dollar patent settlement and a 21 mln dollar tax expense.

The company revised downward its operating income forecast for the year, to a range of 403 mln to 478 mln dollars, from previous forecasts of 415 mln to 515 mln dollars. Quarterly revenue was forecast at between 2.86 bln and 3.16 bln dollars, slightly lower than previous estimates, while the company predicted annual sales of 8.373 bln dollars to 8.673 bln dollars.

Analysts said that the lower figures were due to increased competition for online sales and reduced consumer spending because of higher petrol prices. (dpa)