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Packaged Media Integral to Amazon Q3 Profit

23 Oct, 2007 By: Erik Gruenwedel

A 38% increase to $1.08 billion in packaged-media sales in the United States helped Amazon.com post third-quarter (ended Sept. 30) profit of $80 million, compared to income of $19 million during the same period last year.

Domestic and Canadian packaged-media sales reached $785 million last year.

Media products include books, music, DVD/video, magazine subscriptions, software, video games and video game consoles.

International media sales increased 33% (27% when adjusted for currency exchange) to $1.01 billion, from $757 million last year.

The company sold 2.5 million copies of J.K. Rowling's Harry Potter and the Deathly Hallows worldwide, making the book Amazon's largest new-product release.

Amazon, which doesn't break out sales for specific categories, wouldn't disclose the impact “Potter” books, DVDs and CDs had on quarterly media sales, company officials said in an analyst call.

Worldwide revenue for the Seattle-based online retail behemoth increased 41%, to $3.26 billion, compared to $2.31 billion last year. North American revenue topped $1.79 billion, up 42% from last year.

Jeff Bezos, founder and CEO of Amazon, said the company continued to be pleased early results from digital download service, Unbox, including DRM-free music files.

“We're seeing terrific feedback from customers,” Bezos said. “Selling MP3s has been very successful for us.”

When asked about the impact movie downloads had on DVD sales, Bezos said there was no indication of any cannibalization.

“We haven't seen any evidence of that,” he said. “It is way too early to know whether you would see any of that.”

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