Buoyed by a strong holiday shopping season, online retailing giant Amazon.com Inc announced Tuesday that its fourth-quarter sales rose more than 275% year-over-year to about $250m, but said that the strong sales won’t help the bottom line. Based on fourth quarter sales, Amazon claims to have achieved a $1bn annualized sales level just three-and-a-half years after opening for business. From November 17 through December 31, Amazon says more than one million new customers shopped with it for the first time, as it shipped more 7.5 million items in the period – more than it shipped during the entire year of 1997 – with $6m worth of goods shipped in one day. But despite all that volume, Amazon still warns that the higher seasonal sales will not translate into correspondingly lower net losses in the fourth quarter, as significant sales of video and music lowered gross margins, as did aggressive product pricing. In addition, growth levels, combined with an all-out push to service customers resulted in higher fulfillment costs, according to the company. Amazon declined to project what the actual net loss for the quarter might be. The company expects to release complete quarter and fiscal year financial results in late January. Following the announcement, Amazon shares – a bellweather in the internet retailing market – slipped nearly 10% in early trading before rebounding to close up $6.1875, or 5.23%, at $124.50. Volume for the day was 31.4 million shares, up from an average volume of 13.9 million.
