Amazon reports $7m net loss in second-quarter following heavy Kindle investment
Amazon posted an unexpected net loss of $7m in the three months to the end of June, compared with a $7m profit from the same period of the year previous.
It comes following Amazon’s major investment into the e-reader market, spending heavily in order to challenge the likes of Apple’s iPad.
The second-quarter statement sent the online retailer’s shares lower, with the Financial Times reporting that there are now questions about its ability to generate long-term profits.
Analysts had predicted that the financial report would result in an increase in share price of six cents, rather than the two cent drop.
However, its sales growth rose 22 per cent from a year ago to $15.7bn with its North American business seeing growth of 30 per cent compared to 20 per cent in the rest of the world.
Speaking to Reuters following the results, chief financial officer Tom Szkutak said Amazon is planning to spend heavily on digital video content over the coming months.