Amazon Beats Estimates by 2 Cents
Amazon.com Inc. beat Wall Street’s estimates for second-quarter earnings. The Seattle Internet retailer said sales grew 84 percent from the same period a year ago. The company also had an 32 percent increase in losses. The company lost $89 million, or 33 cents per share, on sales of $578 million.
The earnings report was released after the close of trading on Wall Street. Shares of Amazon.com closed at $36.06¼, down $1.56¼, on the Nasdaq Stock Market.
The company said that its U.S. book, music and video divisions were all profitable in the quarter, posting just over $10 million in gross profits. Amazon.com’s electronics division also saw growth, though the company did not immediately quantify it.
“While we continue to see improvements in all our businesses, we are especially pleased with the profitability in our U.S. Books, Music and Video group and the unusual growth in our Electronics store,” said Amazon.com chairman Jeff Bezos, who said the company was on target for its year 2000 objectives. Answering critics who say the e-commerce giant will run out of money before the end of the year, Amazon.com Chief Financial Officer Warren Jensen said the company had $908 million on hand at the end of the quarter and should have more than $1 billion by year’s end.
“I don’t see anything here that falls under the heading of bad news,” said J.P. Morgan analyst Tom Wyman. “
The company, which gained nearly 3 million new customers in the quarter, experienced only a modest gain in sales compared to the first quarter. The second quarter is, however, considered the slowest time of year for most retailers.
And losses were down from the first quarter of this year, when the company lost 35 cents per share. Analysts had hoped to see such a decrease, looking for a sign that the company would eventually become profitable.
Bezos and other company officials said Amazon.com would not be profitable before 2002 at the earliest.
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Drug Sales Give Amgen a Boost
Amgen Inc.’s second quarter earnings rose 13 percent on improving sales of its mainstay kidney dialysis and chemotherapy drug Epogen, the biotechnology company said. Amgen earned $303 million, or 28 cents per share, up from $268 million, or 25 cents per share in the same period a year ago. The results were a penny better than Wall Street forecasts, according to analysts surveyed by First Call/Thompson Financial.
Sales rose 11 percent to $914 million.
For the six-month period Amgen earned $568.8 million, or 52 cents per share, up from $514.8 million, or 48 cents per share, a year earlier.
The second-quarter increase came despite spending on the launch of several new drugs over the next two or three years, said Kevin Sharer, Amgen’s president and chief executive officer.
Sales of Epogen increased 15 percent to $493 million. Epogen stimulates red blood cell production in chemotherapy and kidney dialysis patients.
Sales of Neupogen, another longtime moneymaker for Amgen, rose only 2 percent during the quarter. Sales were hurt by low wholesaler inventories and unfavorable foreign exchange rates, the company said. Neupogen boosts the production of white blood cells.