News Column

Amazon Expansion Doesn't Pay Off

July 25, 2013

Amazon's expand-at-all-costs strategy did not pay off in the second quarter as the web's largest retailer lost 7 million dollars despite a 22-per-cent upswing in revenues to 15.7 billion dollars.

A year ago the company reported a profit of 7 million dollars on revenue of 12.83 billion dollars. The company's continued bid to expand in areas like cloud computing and in high growth markets including China have crimped its ability to generate short-term profits on its massive turnover.

The expansion trap is likely to continue, according to the company's third-quarter forecast, which predicted revenues between 15.45 billion dollars and 17.15 billion dollars, with income ranging from a loss of 100 million dollars to a profit of 275 million dollars.

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Source: Copyright 2013 dpa Deutsche Presse-Agentur GmbH

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