Amazon 2Q results beat Street

SAN FRANCISCO (AP) ? Inc.’s second-quarter profit fell as the leading online retailer continued to spend on expanding its business.

At the same time, higher merchandise sales lifted revenue 51 percent. Both results, issued late Tuesday, easily beat analyst expectations, as did Amazon’s third-quarter sales outlook. Amazon shares rose 6 percent in after-hours trading.

For the quarter that ended June 30, revenue rose to $9.91 billion from $6.57 billion last year. The company’s electronics and general merchandise revenue rose 69 percent to $5.89 billion, while sales of books, CDs, DVDs and other media rose 27 percent to $3.66 billion.

Amazon CEO Jeff Bezos said in a statement that “low prices, expanding selection and innovation” drove the company’s second-quarter growth.

This growth means Amazon must keep investing in operations expansions and upgrades. In order to support the proliferation of its online retail business, so far this year, it has announced it is building 15 new centers to fill orders. In a conference call with reporters, Tom Szkutak, Amazon’s chief financial officer, said he expects that figure to rise.

Overall, operating expenses rose 54 percent to $9.71 billion.

For the quarter that ended June 30, Seattle-based Amazon said late Tuesday it earned $191 million, or 41 cents per share, compared with $207 million, or 45 cents per share, in the year-ago quarter.

Analysts polled by FactSet were expecting a profit of 34 cents per share on $9.37 billion in revenue.

For the current quarter, Amazon forecast revenue of $10.3 billion to $11.1 billion, the top of which is well above the $10.40 billion analysts have been expecting.

As usual, Amazon did not give specific details about sales of its Kindle e-reader, but Bezos did say the $139 Kindle 3G with Special Offers ? a version of the Kindle released during the quarter that is subsidized with ads ? is now its top-selling Kindle device.

Speculation is swirling that Amazon may be working on a tablet device to rival Apple Inc.’s popular iPad, but Szkutak would not divulge any details. Many e-readers like the Kindle use screens with “electronic ink” technology that makes them best suited for reading, especially in bright light. Tablets such as the iPad have backlit screens and are intended for functions that go beyond reading text, including surfing the Web, video chatting and watching movies.

“We have a longstanding practice of not talking about what we might or might not do in the future, so you’ll have to stay tuned,” Szkutak said.

Amazon shares rose $12.84, or 6 percent, to $227.02 in extended trading. The stock finished regular trading up 69 cents at $214.18.