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Amazon profit jumps despite rising costs

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Amazon.com Inc. (AMZN-Q) posted better-than-expected quarterly earnings as revenue rose 39 percent, but its costs rose even faster.

 

Net income in Amazon's third quarter ended Sept. 30 rose 16 percent to $231 million US, or 51 cents per share, from $199 million, or 45 cents per share, a year earlier.

 

Analysts, on average, had been expecting earnings of 48 cents per share, according to Thomson Reuters.

 

Revenue rose 39 percent to $7.56 billion. That was above the 35 percent rise to $7.36 billion expected by Wall Street.

 

At the same time, operating expenses rose more than 40 percent to $7.29 billion.

 

A lower-priced Kindle e-reader, plus new categories of products, more outside sellers and fall sales momentum have helped Amazon post robust sales that have outperformed rivals and e-commerce trends in general.

 

Looking ahead, Amazon said it expects sales in its holiday fourth quarter of between $12.0 billion to $13.3 billion -- representing growth of 26 percent to 40 percent.

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