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Amazon: Profits Up, Tech Spending Down

According to Bloomberg, Amazon reported an increase of 38% in North American sales this year, causing stock prices to jump as well. The increase was largely, Amazon said, due to electronics and jewelry sales:

"Electronics and general merchandise are becoming a larger part of the business,'' said Colin Sebastian, a San Francisco-based analyst with Lazard Capital Markets LLC.

Amazon also reduced technology spending from 7.8% of sales to 7% of sales. Additionally, reports this article,

Amazon has sought to diversify its product offerings as Barnes & Noble Inc. and other bookstores have cut prices and promoted customer loyalty programs. Sales of books, DVDs and other media made up 64 percent of the company total, down from 68 percent a year earlier.

"Clearly, with the digitization of media, it's been a wise move to move to other areas,'' said Scott Tilghman, a New York-based analyst with Soleil Securities Corp. who rates shares "buy.''

 

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