Amazon Posts 51% Rise in Q2 Sales, Profits Slide

Online retail giant Amazon posted a 51 percent rise in revenue for the second quarter of 2011, but reported a drop in profits owning to increase in investments.

The company, which has sold more eBooks than physical books, reported revenue of $9.91 Billion for the quarter, a 51 percent rise from last year, as it reaped the benefits of investing in improving its warehousing and online divisions.

On the other hand, due to the increase in investments, the company reported a profit of $191 Million, less than the $207 million it had reported in the same quarter a year ago.

Investors were quite happy with Amazon’s results despite the drop in profits, sending its shares up by 6 percent to $229.

"Low prices, expanding selection, fast delivery and innovation are driving the fastest growth we've seen in over a decade," said Jeff Bezos in a press release. The rise in sales of its Kindle eBook reading device helped push the revenue in the second quarter, Amazon said.

"Kindle 3G with Special Offers has quickly become our bestselling Kindle at only $139. Customers love the convenience of a 3G reader -- no hunting for or paying for Wi-Fi hotspots. Amazon picks up the tab for the 3G wireless, so you have no monthly payments or annual contracts." said Bezos.