Free delivery gives Amazon first profit outside Christmas

NEW YORK - Amazon.com has made its first quarterly net profit outside the Christmas period, thanks to its free delivery promotion and partnerships with other online retailers.

The web's biggest retailer posted net income of $16m (拢9.55m) for the third quarter to September, compared with a loss of $35m during the same period last year. Net sales were $1.13bn, up 33% from the third quarter of 2002.

The Seattle-based company has made strenuous efforts to increase its customer base, offering free delivery on sales above a certain level, wider discounting, and selling goods on its site in partnership with other online retailers such as Gap.

Last quarter, said that switching budget away from advertising and investing in free shipping was responsible for a 37% increase in net sales over the past quarter. Net sales last quarter were $1.1bn.

Amazon.com founder and CEO Jeff Bezos said the results would be followed by even better sales over Christmas.

"We expect more customers to turn to us for their holiday gifting needs this year -- producing our biggest holiday shopping season ever," he said.

Amazon's shares have increased almost 10-fold from less than $6 in two years, as investors have become more confident that the company will be profitable in the long term.

The free delivery idea has been a big hit for Amazon. In the US, consumers qualify for free delivery on orders over $25. In the UK, recently lowered its free delivery threshold from 拢35 to 拢25 in an effort to entice customers online.

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