Amazon.com rang up a fourth-quarter net profit of $5 million, or 1 cent per share. It lost $545 million, or $1.53 per share, in the same period a year ago.
The e-tailer also rang up $1.12 billion in sales, its first billion-dollar quarter in its history, thanks to strong demand in its core U.S. books, music and video segment. Quarterly revenue grew 15 percent to $1.1 billion from the same period a year ago. Sales also exceeded analysts' expectations of $1.01 billion by some $100 million.
Analysts said the results indicate that Jeff Bezos the company founder who was named Time's Person of the Year amid the dot-com boom of 1999 was right when he pushed the company to "get big fast" at the expense of immediate profits in the late 1990s.
"E-commerce isn't an easy matter," said Jeetil Patel, an analyst with Deutsche Banc Alex. Brown. "It took the company $1.2 billion in revenue to achieve a profit, so scale is definitely a critical success factor. Not a lot of smaller companies will be able to pull this off."
In the final quarter of 2000, Amazon.com spent $131 million to fulfill its products. One year later, Amazon dropped that cost down by 17 percent to $109 million. But it didn't just stop there. Amazon drove down its general and administrative costs and marketing and technology costs as well.
Including interest expense, Amazon.com posted a pro forma net profit of $35 million, or 9 cents per share. Last year, mazon.com lost $90 million, or 25 cents per share. Analysts surveyed by Thomson Financial/First Call forecast a loss of 7 cents per share on revenue of $1.01 billion.
"Amazon.com exceeded the goal it set a year ago - to reach pro forma operating profitability during the quarter - by delivering not only a pro forma operating profit, but also a pro forma net profit, which includes net interest expense," the company said.
For all of last year, Amazon.com generated $3.12 billion in sales, up 13 percent from 2000. Operating cash flow improved 42 percent to $349 million in fourth quarter 2001, a $101 million increase.
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