Amazon Announces Good Third Quarter Results

Last week Amazon reported excellent third quarter figures. Net income was $ 199 million – 70% up compared to the third quarter of 2008. Both revenues and profits exceeded analyst’s predictions and a very strong fourth quarter is now on the cards. Share price rose by 27% amid strong expectation that Amazon would become the dominant online retail business in the post-recession economy.

A major factor in Amazon’s success has surely been the Amazon Kindle e-book reader. The Kindle was originally launched in November of 2007. Now in its second generation, it has gained a 60% share of the US e-book reader market. After a long wait, Amazon has commenced shipping the Kindle 2 reader to over 100 different countries worldwide. A second price drop since the launch accompanied the announcement of international shipping.

The announcement of international shipping was accompanied by a second price reduction. A third reduction to $259 followed less than two weeks later – and this was considered by many to be a reaction to the announcement of the “Nook” e-book reader by Barnes and Noble. Whatever the reasons, a focus on the huge worldwide market makes a lot of sense and can only further boost Amazon’s sales.

Apple, Sony, Asus and Apple all have new e-book readers in various stages of development. The e-book market may be relatively new, but it is changing and growing at exponential speed. Considering the domination of Amazon thus far, and the fact that the Kindle is now their number one selling product, it seems unlikely that Amazon will rest on its laurels and watch other manufacturers speed by it (just as Amazon themselves leapfrogged Sony a couple of years ago).

In any event, Amazon have plenty of other tricks up their corporate sleeve. They have seen strong growth in Amazon Prime mebership – which offers enhanced delivery options for an annual payment. This growth was especially strong in international areas.

A spokesman for Amazon said that Amazon would continue to grow its product range and look to expand its business geographically over time.

Sales between $ 8.13 billion and $ 9.13 billion are now being forecast for Q4.

Learn more about the Amazon Kindle reader.