Amazon.com, Inc. released its 1998 second quarter results late yesterday, reporting $116 million in net sales, a surge of 316% over sales of $27.9 million for the same period last year.
However, pro forma net losses of $15.8 million or $0.33 per share were also recorded, an increase from second quarter 1997 net losses of $6.7 million or $0.16 a share.
“The Earth’s biggest book store” also reported a pro forma operating
loss of $11.6 million, amounting to 10% of net sales, compared to last year’s second quarter operating losses that totaled $7.1 million, or 25% of net sales.
Reported net losses on a GAAP basis came to $0.44 per share, which included $5.4 million of amortization of goodwill and April 1998 acquisitions of Bookpages Ltd., Telebook Inc., and Internet Movie Database Ltd.
Amazon.com claimed a 415% spike in cumulative customer accounts,
gaining 880,000 in the second quarter to reach 3,140,000 by June 30, 1998,
up from 610,000 customer accounts at the end of June, 1997. In addition, Amazon said repeat customer orders accounted for over 63% of all orders requested in the quarter ended June 30, 1998.
“Our leadership position comes from our obsessive focus on customers,”
said Jeff Bezos, Amazon.com’s founder and CEO, in a statement. “Customers want selection, ease of use, and the lowest prices. These are the elements we work hard to provide.”
“We continued to improve our customer experience during
the quarter with the opening of our music store, our easier-to-navigate store layout, and our expansion into the local UK and German book markets. These initiatives will continue to require aggressive investment and entail significant execution challenges.”
Amazon made some significant strategic moves during the quarter aimed at expanding its online offerings, including entry into the music e-tail arena in June with the launch of a new music store.
With the April acquisitions of Bookpages, Telebook, and Internet Movie Database, Amazon unveiled plans to expand internationally and secure a presence in the video sales market.
Also, in an effort to relieve a debt of $75 million, Amazon made a $326 million offering of 10% senior discount notes in May, and in June the company commenced a 2 for 1 split of its common stock.
Most recently Amazon fortified its management team with the appointment of former Wal-Mart v.p. Jimmy Wright to the position of vice president and chief logistics officer.
Amazon has syndicated selling relationships through its Associate Program with members such as AOL.com, Yahoo!, Netscape, Excite, AltaVista Search, @Home Network, and new additions Quicken.com and Compaq Computer Corp.
