Amazon.com has more losses

By : |October 29, 1999 0

Amazon.com more than doubled its third quarter sales to $356 million. But the online book, toy and music merchant still posted a $86 million loss and warned fourth quarter losses will increase as the firm is spending heavily on advertising to increase business. Amazon.com has not made a single profit since its founding. Amazon.com’s shares rose to $76.25 following the news.


Industry analysts said some investors are starting to lose their patience with Amazon.com after seeing sales soar but losses continuing to mount. Company officials said marketing expenses in the current quarter would triple in the current quarter to as much as $300 million. Amazon.com CEO Jeff Bezos said the company was sticking to its business plan of spending heavily in order to be in a leadership position when Internet business becomes a mainstream force in the economy. Internet business represents a huge business opportunity. The further we go into this the more we find new things to do, and we think it’s OK to update our plans as we go. We think it would be really foolish to slavishly commit to plans that we made in the past when we’re in an environment that’s so rapidly changing,” Mr. Bezon said.


To underscore the company’s need to keep investing, Bezos added that Amazon.com’s U.S. book business would show its first profit this quarter. And the company expects online sales of toys to boost sales to the half billion level this quarter. Amazon.com added a record 2.4 million customers in the quarter, bringing its cumulative total to 13.1 million.

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