NEW YORK (AP) — Amazon.com Inc.'s net income declined in the first three months of the year even though revenue increased 22 percent, as the online retailer continued to spend heavily on order fulfillment and rights to digital content.
The world's largest online retailer, which also sells the Kindle devices and services, said Thursday that it earned $82 million, or 18 cents per share, in the first quarter. That's down 37 percent from $130 million, or 28 cents per share, in the same period a year earlier. But it's higher than the 7 cents expected by analysts polled by FactSet.
Revenue rose 22 percent to $16.07 billion, from $13.19 billion. Analysts expected $16.14 billion.
Amazon's operating expenses rose 22 percent to $15.9 billion, from $13 billion. The company has been investing a lot of its income in enhancing its distribution network, its shopping website and its Kindle business as part of a long-term growth plan. Because of that, and deep discounts it offers customers, Amazon's profit margins have been thin.
For the current quarter, Amazon expects revenue of $14.5 billion to $16.2 billion. The midpoint of the range is lower than the $15.92 billion that analysts had expected, but the company typically gives a conservative forecast.
Baird analyst Colin Sebastian said that a measure called paid unit growth — 30 percent — was a bit slower than expected. This figure refers to the physical and digital goods that Amazon and its third-party sellers sell on its sites worldwide, excluding returns and cancellations.