Amazon Q2 net profit jumps

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Amazon.com Inc. posted quarterly net profit on Tuesday that leaped a surprising 250% as sales rose 35% and subscriptions to the online retailer's discount shipping program accelerated, sending shares up 12% after-hours.

The company also raised its forecast for full-year sales.

Net income in the second quarter rose to $78 million, or 19 cents per share, compared with $22 million, or 5 cents a share, a year earlier. Revenue rose to $2.89 billion in the second quarter, which is seasonally the slowest.

Earnings of 19 cents per share topped the Wall Street target of 16 cents, and revenue also beat the $2.8 billion average expectation, according to Reuters Estimates.

For the third quarter, the company said it expects net sales in a range of $3.0 billion to $3.18 billion, with operating income in a range of $75 million to $110 million.

Amazon said it now expects full-year sales in a range of $13.80 billion to $14.30 billion. Previously, the company said it expected a range of $13.4 billion to $14.0 billion.

Amazon shares have been on a surge since last quarter's results showed improved profit margins and pared-back spending. Bullish investors, jumping on signals that investments in technology and content might be beginning to pay off, have pushed Amazon's price up more than 60% as of Monday's close since first-quarter earnings were announced in April. Shares have more than doubled since year-ago results came out.

The company is now valued well above major Internet players as well as brick-and-mortar retailers. Amazon shares, as of Monday's close, traded at 52 times 2008 expected earnings, compared with 21 times at eBay Inc., 46 times at Yahoo Inc. (YHOO.O) and 14 times at Wal-Mart Stores Inc.

Amazon shares rose 12.2% to $77.70 from a close of $69.25 on Nasdaq.
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