Booming sales of e-book readers and material to read on them brought early holiday cheer to online retailer Amazon.com (AMZN) in the third
quarter. And judging from the company's better-than-expected forecast for the current quarter, robust sales will continue through yearend at Seattle-based Amazon.
On Oct. 22, Amazon said third-quarter net income surged 68%, to $199 million, while revenue jumped 28%, to $5.45 billion, compared with Wall Street's estimate of $5 billion. "This looks like holiday-season performance and they're doing it in the third quarter," says Jeff Lindsay, analyst with Sanford C. Bernstein. For the quarter that ends in December, Amazon forecast sales of $8.1 billion to $9.1 billion, compared with $8.19 billion expected by analysts surveyed by Bloomberg News.
The performance and forecast reflect growing demand for the Kindle electronic book reader, which now sells more units and contributes more revenue than any other product on the site, Amazon said. The company doesn't release individual sales numbers for the device, but Citigroup (C) analyst Mark Mahaney estimates that it will sell 1.5 million, worth $700 million. An international edition of the reader went on sale the same day Amazon announced its third-quarter results.
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