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Amazon profits down, but sales way up

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Online retailer Amazon.com posted its second quarter financial results, and although profits were down 8 percent compared to a year ago, the company still made over $190 million during the second quarter. However, that wasn’t the number that got investors and stock-watchers excited: Amazon.com also reported that its second quarter sales were up 51 percent to some $9.91 billion for the quarter.

“Low prices, expanding selection, fast delivery and innovation are driving the fastest growth we’ve seen in over a decade,” said Amazon.com founder and CEO Jeff Bezos, in a statement.

Amazon (still) has not revealed any hard sales number for its Kindle line of ereader devices, However, Bezos indicated the company’s Kindle 3G with Special Offers—a version of their 3G-enabled ereader that has a lower price tag in exchange for receiving offers and ads from Amazon and its partners—has become its best-selling Kindle model since AT&T began sponsoring screensavers on the device. Overall sales of “Worldwide Electronics and Other General Merchandise”—which includes the Kindle—were up 69 percent for the quarter.

Although Amazon.com’s operating margin is just 2 percent—down from 4.1 percent a year ago—investors focused on the company’s sales growth during the tough economic quarter as a positive sign for the future. And analysts also noted that Amazon could have turned a larger profit during the quarter, but chose instead to invest in its distribution and warehousing infrastructure.

The tech industry is widely expecting Amazon.com to introduce its own tablet computer to compete with Apple’s iPad; the company made no new announcements along with its earnings results.

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