Amazon.com Inc. reported a $92 million profit in the second quarter of 2015, a significant swing from this time last year when the world’s largest online retailer posted a $126 million loss.
North America net sales helped fuel another strong quarter for the retailer. Amazon, No. 1 in the Internet Retailer 2015 Top 500 Guide, today reported net sales in North America of $13.796 billion, up 25.5% from $10.994 billion during the same period last year. It’s a similar story in North America through the first half of 2015, with Amazon reporting sales of $27.202 billion, up 24.8% from $21.802 billion during the same period last year.
During the quarter ended June 30, Amazon further put pressure on competitors by offering faster delivery in more major cities. It launched same-day delivery in 14 markets in the United States while increasing the number of markets where its Prime Now one-hour delivery service is offered to nine.
Amazon’s fulfillment costs have grown accordingly. During the quarter, Amazon spent $2.876 billion on fulfillment, up 20.7% from $2.382 billion during the same period last year. Through the first six months of 2015, Amazon has spent nearly a billion dollars more on fulfillment than it did during the same period last year, posting fulfillment costs of $5.634 billion, up 19.9% from $4.699 billion.
“Amazon shocked Wall St. with a huge beat on the top and bottom line driven by three areas: AWS (cloud computing platform), Prime and the Marketplace,” ChannelAdvisor executive chairman Scot Wingo wrote in his blog. “Amazon had some impressive acceleration. Most notably, international EGM [electronics and general merchandise] came in at 31%, up 10% from Q1’s 21%. We looked and have never seen anything like that since we’ve been following Amazon.” ChannelAdvisor is e-commerce services provider that helps merchants sell via online marketplaces.
“The teams at Amazon have been working hard for customers,” CEO Jeff Bezos said in a statement, noting the retailer’s accomplishments through the first half of the year.
For the second quarter ending June 30, Amazon reported:
- Net worldwide sales of $23.185 billion, up 19.9% from $19.340 billion during the same period last year. Were it not for an unfavorable $1.39 billion in currency fluctuations from the strong dollar reducing the value of goods sold in other currencies, Amazon says its global sales would have been up 27% in the quarter.
- Net product sales, or products sold by Amazon itself, made up 73.8%, or $17.110 billion, of the retailer’s total sales. That’s down from 78.9% in the same quarter last year, reflecting the growing role of other merchants that sell on Amazon’s sites.
- Net service sales grew significantly. Such sales include commissions from outside merchants that sell on Amazon marketplaces, the Amazon Web Services cloud computing service and other smaller revenue sources and account for the remainder of Amazon’s total net sales. Net service sales were $6.081 billion, up 48.7% from $4.089 billion during Q2 2014.
- International net sales were $7.565 billion, up 3.1% from $7.341 billion during the same period last year. International sales accounted for 32.6% of the company’s overall sales compared to accounting for 38% of the company’s overall sales during the same period last year.
- Sales of electronics and other general merchandise in North America were $10.987 billion, up 31.3% from $8.366 billion.
- Media sales in North America of $2.620 billion, up 6.3% from $2.464 billion during the same period last year.
Through the first six months of 2015, Amazon reports a profit of $35 million, a significant turnaround from the same period last year, when it posted an $18 million loss. Other results for the first half ended June 30:
- Net global sales were $45.901 billion, up 17.4% from $39.081 billion. Net product sales accounted for $34.187 billion, or 74.5%, of net sales during the quarter compared with 79.2% during the same period last year.
- Net service sales were $11.714 billion, up 44.2% from $8.125 billion.
- International net sales were $15.310 billion, up 0.6% from $15.224 billion. International sales now account for 33.4% of Amazon’s overall sales, compared with 39% a year ago.
- Sales of electronics and other general merchandise in North America were $21.237 billion, up 31.1% from $16.196 billion.
- Media sales in North America of $5.589 billion, up 5.7% from $5.289 billion during the same period last year.