By George Stahl and Andrew Morse
Amazon.com (AMZN) shares trade at levels not seen this decade after reporting blowout results/guidance and calling the Kindle its “No. 1 bestselling item.”
Interestingly, while 3Q sales and EPS easily surpassed Street views, gross margins were a bit light, 23.4% vs. Thomson Reuters’ 23.6%.
Media sales – which had been sluggish in recent quarters – jumped 17% to $2.93B. Particularly of note: North American media sales grew 13% y/y in 3Q. The company complained they were flat three months ago, prompting concern AMZN’s growth rate was slowing.
Amazon shares, up 83% in 2009, rose 15% after hours to $107. That would represent a new year high, and the stock’s highest level since December 1999. AMZN shares are frequently volatile post-report because of their healthy but decreasing short interest, now at 5.7% of float.
Amazon’s smashing 3Q shows broad-based strength in all of its product categories and geographies, says Sandeep Aggarwal, an analyst at Collins Stewart.
“This makes Amazon probably the fastest-growing publicly traded Internet company,” Aggarwal said. “Amazon has always traded at a premium and now we’re seeing why.”