Amazon.com Inc reported solid first-quarter profits as the world's largest Internet retailer controlled shipping expenses and other costs, but international revenue growth slowed. Amazon, which has been on a spending spree in recent years, posted declines in net income and operating profit, year over year.
However, the company's gross profit margin, a closely watched measure of its profitability, came in at 26.6 percent, the highest in at least a decade, according to Scott Tilghman, an analyst at B Riley & Co. Amazon has been building distribution warehouses closer to customers, reducing shipping costs. It also been charging third-party merchants on its marketplace higher fees for shipping services. In the first quarter, net shipping costs were 4.7 percent of sales, down from 5.1 percent a year earlier.
First-quarter revenue jumped 22 percent to $16.07 billion, propelled by growing sales of digital content, cloud-computing services and gains in its main retail business. International revenue rose 16 percent in the quarter, year-over-year. In the same period of 2012, Amazon's international revenue climbed 31 percent, year-over year. Amazon shares rose 1.6 percent to $279 in after-hours trading following the results.
Amazon forecast second-quarter revenue of $14.5 billion to $16.2 billion and operating results from break-even to $350 million. The latter guidance excludes stock-based compensation expenses and other items such as amortisation of intangible assets.
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