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Amazon delivers big profit boost, but shares dive
[SAN FRANCISCO] US online giant Amazon on Thursday reported profits doubled in the past quarter, as it attracted more customers with video and other services, but the results missed Wall Street forecasts.
Amazon shares slid 11 per cent to US$565.19 in after-hours trade on the results, which showed a fourth-quarter profit of US$482 million, up from a US$214 million profit a year earlier.
The results marked the third consecutive quarterly profit for the company, which is a heavyweight in online retail as well as cloud computing, and more recently streaming video.
Overall revenue jumped 22 per cent from a year ago to US$35.7 billion.
Amazon, which earned a reputation for making little or no profit as it gained market share, managed an annual profit for 2015 of US$596 million.
Revenues were up 20 per cent for the year, at US$107 billion.
"Twenty years ago, I was driving the packages to the post office myself and hoping we might one day afford a forklift," said chief executive Jeff Bezos, who founded the company in 1994.
"This year, we pass US$100 billion in annual sales and serve 300 million customers. 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 One."
Amazon has made Mr Bezos into one of the world's wealthiest individuals, with a fortune estimated at some US$50 billion, and he has since created his own space company called Blue Origin, and purchased the Washington Post newspaper.
The company has not offered details on its revenue from its Amazon Prime membership service, which offers free delivery and a variety of other services, or its own Kindle and Fire devices.
But it has broken down the finances from its cloud computing unit called Amazon Web Services: It took in US$2.4 billion in revenue in the quarter and US$7.9 billion for the year, accounting for an operating profit of US$687 million in the quarter and US$1.9 billion for the year.
The research firm Consumer Intelligence Research Partners estimates that Amazon Prime now has 54 million US members, spending on average about US$1,100 per year - much more than the US$600 per year spent by non-members.
Amazon offered no detailed numbers but said worldwide paid Prime memberships increased 51 per cent last year, growing by 47 per cent in the US and "even faster outside the US."
Those who subscribe get access to much of Amazon's video streaming library for free as well as music and other content.
Amazon's Mozart In The Jungle programme received two Golden Globes earlier this month, only a year after the company scored its first win ever at the Globes for the original programme Transparent.