Asset sale boosts Amazon profit, shares rise

By Alexandria Sage

SAN FRANCISCO (Reuters) - Amazon.com Inc's (AMZN.O) quarterly profit doubled and beat expectations, helped by an asset sale gain, and 41 percent sales growth indicated to Wall Street that cost-conscious shoppers are heading online to save.

Amazon shares zig-zagged in after-hours trade on Wednesday before trading 8 percent higher later in the evening.

Amazon's relatively strong performance in a tough economic environment may have excited investors, along with the benefits for the company from shoppers going online to save on gasoline, said Global Crown Capital analyst Martin Pyykkonen.

Investors may also have been cheered by positive comments from Chief Executive Jeff Bezos about the Kindle, Amazon's digital book reader, he said.

Bezos said 10 percent or more of the 140,000-odd titles available for the Kindle were being sold for electronic reading rather than in book form. The percentage was in the low double-digits, he said.

Recent disappointing results from rival eBay Inc (EBAY.O) and tech giants Apple Inc (AAPL.O) and Google Inc (GOOG.O) have worried investors, though they seemed unfazed by Amazon nudging lower the midpoint of its 2008 operating income target range.

The company posted second-quarter net profit of $158 million, or 37 cents per share, compared with $78 million, or 19 cents per share, a year earlier. Revenue in the quarter, which is seasonally the slowest, rose to $4.06 billion.

That beat analysts' average revenue forecast of $3.95 billion, according to Reuters Estimates. The profit comfortably topped the average Wall Street target of 26 cents per share, but excluding the European sale the beat was just 2 cents.