Amazon.com Profit Doubles

Amazon.com Profit Doubles

Jan. 30 (Bloomberg) -- Amazon.com Inc., the world's largest Internet retailer, said fourth-quarter profit more than doubled on higher holiday sales of electronics, video games and toys.

The shares fell in late U.S. trading after it forecast full-year operating income that trailed analysts' estimates.

Net income climbed to $207 million, or 48 cents a share, from $98 million, or 23 cents, a year earlier, Seattle-based Amazon.com said today in a statement. Revenue increased 42 percent to $5.67 billion.

Amazon.com said last month the 2007 holiday season was its ``best ever,'' helped by sales of DVD players, GPS systems and games for Nintendo Co.'s Wii console. The company is expanding beyond sales of books and DVDs by adding more product categories and taking market share from EBay Inc. by giving outside sellers a place to hawk their goods.

``They want to be a platform for online commerce, either from their own inventory or third parties,'' Colin Sebastian, an analyst at Lazard Capital Markets LLC in San Francisco, said today. ``Amazon, EBay and Google are all trying to be the online market of choice.'' He recommends holding Amazon.com shares and doesn't own any.

Amazon.com forecast full-year operating income between $785 million and $985 million on sales of as much as $19.8 billion. Eleven analysts surveyed by Bloomberg estimated operating profit of $1.18 billion on revenue of $18.2 billion.

Amazon.com dropped $2.46, or 3.3 percent, to $71.75 as of 4:22 p.m. in trading after the close of U.S. markets. Earlier it rose 26 cents to $74.21 in Nasdaq Stock Market composite trading. The stock has dropped 20 percent this year after more than doubling in 2007.

Analysts' Estimates

Eighteen analysts estimated average fourth-quarter net income of 47 cents a share. Nineteen projected sales of $5.36 billion. Amazon.com forecast fourth-quarter sales of $5.1 billion to $5.45 billion in October.

Internet holiday sales climbed 19 percent from the year- earlier period, research firm ComScore Inc. said, outpacing the 3 percent growth by U.S. retailers in general, according to the National Retail Federation.

The online retailer sells products in more than three dozen categories ranging from power tools to musical instruments.

In November, Amazon.com introduced Kindle, a $399 portable electronic reading device with more than 90,000 books available. It also offers the Unbox service to download movies and television shows.

Amazon.com started a digital-music service in September to compete with Apple Inc.'s iTunes. Since September the company has added songs from Warner Music Group Corp. and Sony BMG Music Entertainment and now offers content from the four largest record companies.

BLOOMBERG