Amazon shows why it’s every retailer’s nightmare
Amazon.com said its net sales increased 22% to $35.7 billion in the fourth quarter ended Dec. 31, 2015, compared with $29.3 billion in fourth quarter 2014. With a $1.2 billion unfavorable impact from year-over-year changes in foreign exchange rates, fourth quarter sales would have increased 26%.
That Amazon.com grew its top line isn’t surprising, but the company’s surge in profits was big enough to satisfy analysts who expected a loftier performance. Net income was $482 million in the fourth quarter, or $1 a share, compared with net income of $214 million, or 45 cents a share in fourth quarter 2014. Analysts had forecast Amazon.com would earn $1.56 a share, well below the reported $1 a share.
“Twenty years ago, I was driving the packages to the post office myself and hoping we might one day afford a forklift. This year, we pass $100 billion in annual sales and serve 300 million customers,” Jeff Bezos, Amazon.com founder and CEO said in a statement. “And still, measured by the dynamism we see everywhere in the marketplace and by the ever-expanding opportunities we see to invent on behalf of customers, it feels every bit like day 1.”
The company’s full year sales increased 20% to $107 from $89 billion in 2014, and were negatively affected by a $5.2 billion headwind related to currency exchange. Net income was $596 million, or $1.25 per share, compared with net loss of $241 million, or $52 a share in 2014.
Looking at the company sales by region, sales in North America increased 24% to $21.5 billion, international sales increased 12% to $11.8 billion internationally and Amazon Web Service’s sales increased 69% to $2.4 billion.