Mozart in the Jungle
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SVOD bolsters Amazon.com’s impressive sales growth

The Seattle-based company saw a 15% net sales climb in first-quarter earnings thanks in part to Amazon Prime and original content.
April 24, 2015

Spurred by the success of its SVOD programming and original content production, Amazon.com’s fortunes are mightier than ever.

The Seattle-based company reported a 15% net sales climb in first-quarter earnings from a year earlier. In dollars, Q1 2015 net sales rang in at $22.72 billion. compared to $19.74 billion in the same period in 2014.

Amazon’s Prime Instant Video SVOD service and content producer Amazon Studios were key factors in the growth, said company execs in a conference call, with Amazon Studios providing full-season lineups of Mad Dogs, The Man in the High Castle, The New Yorker Presents, children’s programs Just Add Magic and The Stinky and Dirty Show for audiences in the U.S., U.K. and Germany, and sophomore seasons of Mozart In the Jungle, Bosch and original series Tumble Leaf, Creative Galaxy, Annedroids and Gortimer Gibbon’s Life On Normal Street. 

“We’re feeding the platform with category expansion, original content, Prime Instant Video devices, Prime Now,” said Tom Szkutak, Amazon CFO and SVP. “The common theme is they are all really intertwined with Prime and inextricably to our consumer business in Prime.”

The $22.72 billion total includes a $1.3 billion unfavorable impact of year-over-year foreign exchange rates during the quarter. Without it, Amazon.com claims it would have painted a rosier 22% net sales increase.

Highlights from the report include:

  • Operating income increased dramatically to $255 million from $146 million in the same first quarter in 2014.
  • Operating cash flow increased 47% to $7.84 billion over a 12-month period, compared with $5.35 billion a year earlier.

Despite huge increases, Amazon.com reported a net loss of $57 million compared with a net income of $108 million reflecting the same time period in 2014.

For its second quarter, concluding June 30, Amazon.com forecast net sales to increase between 7% and 18% compared with Q2 2014, reaching between $20.6 billion and $22.8 billion. Operating income is expected to land about $500 million in the red, or a positive cashflow of $50 million, compared with a $15 million loss a year earlier.

 

 

 

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