Amazon profit plunges on acquisition cost

Online retail titan Amazon said its profit in the past quarter plunged 96 percent
Online retail titan Amazon said its profit in the past quarter plunged 96 percent, with the cost of buying a robotics firm hurting already weak results.

Online retail titan Amazon said its profit in the past quarter plunged 96 percent, with the cost of buying a robotics firm hurting already weak results.

Amazon said its profit fell to $7 million, as it accounted for the costs of acquiring Kiva Systems earlier this year.

But the results were disappointing even excluding special items, with profit amounting to one cent per share, below forecasts of two cents.

Revenues also came in shy of estimates at $12.83 billion in the quarter, an increase of 29 percent.

For the current quarter, Amazon said it expects revenues of between $12.9 and $14.3 billion.

The company made no comment on new product launches, despite widespread reports that it is developing an upgraded Kindle Fire, its , or even its own mobile phone.

Amazon shares rose one percent at $222.22 in after-hours trade following the results.

Founder and Jeff Bezos said Amazon was continuing to invest in media -- electronic content such as streaming video, and music.

"We've also added 18,000 movies and TV episodes available for unlimited streaming," he said.

"And we've added the Kindle Owners' Lending Library -- borrow 170,000 books for free with no due dates -- it even includes all seven Harry Potter books."

Amazon earlier this year acquired Kiva, a robotics firm expected to help in managing its warehouses and supply chain, for $775 million.


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(c) 2012 AFP

Citation: Amazon profit plunges on acquisition cost (2012, July 27) retrieved 24 August 2019 from https://phys.org/news/2012-07-amazon-profit-plunges-acquisition.html
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