Amazon Q1 2011: Income Falls Short, Sales Increased

Amazon has declared its financial results for Q1 2011 which fall short by  one third as compared to last year first quarter which is way mismatched to the Wall Street forecasts.

Amazon (AMZN) managed the net income of $201 million (44 cents a share) as compared to earlier year $299 million. The company’s sale increased by 38% in the first quarter to a total of $9.9 billion surpassing the analysts’ $9.5 billion estimate.

Shares fell nearly 6% after hours as investors were rattled by the earnings miss, but they had recovered a bit, to a 2% loss, by 6 pm. ET. Amazon shares have been sluggish in 2011, rising only 1.3% year-to-date as of Tuesday’s close, even as the broader market has rallied.

Investors are also seeing the next quarter on the down graph. Amazon expects sales of $8.9 to $9.7 billion in 2nd quarter but with decreased operating income.

Amazon predicted that the net income would be between $95 to $245 million in the first quarter which would be a decline of 9% to 65% as compared to last year.

Chief Financial Officer, Tom Szkutak told the analysts that the drop is caused by the Japan earthquake which reduced the international revenue by 5%, and to a total of 27%

“Growth rates have picked up, but they’re not back to levels we saw before the event,” Szkutak said.

The company did not talk about the earning shortfall, instead it focused on the recently released products.

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