SEATTLE-Riding on the back of healthy gains in sales, Amazon.com reported an increase of 31.7 percent in its first-quarter net income, to $108 million.
Total net sales in the quarter, which ended on March 31, were $19.7 billion, up 22.8 percent over the first quarter of last year. Net product sales posted an 18.3 percent increase, while net services sales rose a dramatic 44.2 percent.
Jeff Bezos, Amazon’s CEO and founder, said, “We get our energy from inventing on behalf of customers, and 2014 is off to a kinetic start.” Explaining the sales and income gains, Bezos cited the launch of Fire TV, a box that plugs into a high-definition television to provide access to a number of video rentals and services. In addition, the company debuted Prime Pantry, a service that provides Amazon Prime members with access to low-priced everyday essentials.
Gross margin in the quarter picked up 223 basis points to finish at 28.8 percent. Operating expenses increased 35.5 percent in dollars and 262 basis points as a percentage of sales, to 28.1 percent.
Amazon said the company is now projecting second-quarter net sales to total between $18.1 billion and $19.8 billion, or 15 to 26 percent greater than last year’s second quarter.