Tech Investments Cut Amazon’s Third-Quarter Profit
Amazon.com’s net income fell from $30 million in third-quarter 2005 to $19 million during the quarter just ended. The Seattle-based online retailer attributed the drop partly to increased investment in technology — both infrastructure and engineers’ salaries. The company’s technology and content expenses jumped from $121 million a year ago to $172 million in the quarter just ended.
Amazon’s third-quarter revenue increased from $1.86 billion to $2.31 billion during the quarter just ended, while its operating income fell from $55 million to $40 million. Amazon’s third quarter ended on Sept. 30.
The company continues to rack up memberships in its Amazon Prime program, which was introduced in February 2005. Under this program, in return for an annual $79 fee members receive unlimited free two-day shipping for more than 1 million items.
Among its highlights during the last 12 months, the company’s international sales rose 29%, to $1.05 billion. During the last 12 months, Amazon’s Japan Web site launched a Health & Beauty store.
