After predicting that it would lose as much as $530 million in the fourth quarter, Amazon posted operating profit of $591 million in the final period compared to $510 million in the last quarter of 2013.
Sales rose 15%, to $29.33 billion. For the full year, sales increased 20% to $88.99 billion, but the company eked out operating income of only $178 million compared with operating income of $745 million in 2013. The net loss in the year was $241 million compared with net income of $274 million in 2013.
The sales gain for the year was driven by Amazon’s other segment which includes its fast-growing Amazon Web Services business; total revenue in the other category rose 42% to $5.6 billion. In its largest categories, revenue in the electronics and other merchandise segment rose 25% to $60.9 billion, while media sales rose 3.6% to $22.5 billion. Sales in the media group, home to books and e-books among other products, increased 7% in North American for the year but was almost flat internationally at $10.9 billion. In the fourth quarter, media sales in North America rose by less than 1%, to $3.5 billion, and fell 8% in the international market to $3.40 billion.
CFO Tom Szkutak blamed the slowing growth in media to softness in sales of videogame consoles and video games.
Szkutak said the company is still focused on offering customers great prices, while also ensuring that it remains in stock on products offered for sale on the site. The company did not release a hard figure on the number of Prime customers it has, but said that in the year the number of Prime members rose 53% on a base of "tens of millions." Szkutak noted that when Amazon customers begin using Prime they 'step up" their purchases through the online retailer.