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Amazon: Sales, Losses Up; Acquisitions; a Stock Split
Jim Milliot -- 5/4/98
Revenues up to $87 million in quarter while loss triples to $9 million, but stock still climbs
Amazon.com made a flurry of announcements last week that included results for its first quarter, the acquisition of three companies and a two-for-one stock split.

Figures for the period ended March 31, 1998, showed another tremendous increase in sales compared to the same period a year ago as sales rose 446% to $87.4 million. Sales in the first quarter also marked a 32% increase over sales in 1997's fourth quarter. Accompanying the huge sales gain was a tripling of Amazon's net loss for the first quarter, with its loss falling to $9.3 million from $3.0 million in the first quarter of 1997.

Amazon.com said its cumulative customer count rose to 2.26 million at the end of the quarter, compared to 1.51 million customers at the close of 1997. Repeat customers represented 60% of orders placed in the quarter. The quarter also saw Amazon.com begin the development of a pilot program to sell music products online.

Two of the three acquisitions announced last week (Bookpages and Telebook) were part of Amazon's planned expansion into Europe, while the third (Internet Movie Database) was done with an eye toward Amazon increasing its sales of video online.

Bookpages is one of the largest online bookstores in the U.K. and provides access to all 1.2 million books in print there. Telebook, operating through its ABC Bucherdienst subsidiary, is one of Germany's major online bookstores with a catalogue of nearly 400,000 German-language titles. The Internet Movie Database is a collection of movie and television information on the Internet that Amazon.com will use to enhance its site when it expands its online video sales.

Amazon.com will use stock to cover the majority of the $55-million price tag associated with the three purchases, plus some cash. In connection with the deals, all of which closed last week, Amazon.com will issue 540,000 shares of common stock. The company's stock rose 15% to close at $95.62 per share on April 28, the day after the announcements were made. Amazon.com's $9 million net loss was less than analysts had expected.

The company's two-for-one stock split will be payable June 1 to shareholders of record on May 20.
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