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TheStreet Open House

Why Amazon Wants To Do Everything

Updated from 4:18 p.m. to include comments from the conference call and updated share price.

NEW YORK (TheStreet) -- Shares of Amazon (AMZN) were flat after the e-commerce giant posted results that were better than expected, as the company continues to be all things to all consumers.

For the first-quarter, Amazon earned 23 cents a share on $19.74 billion in revenue, as net sales increased 23% year-over-year. The company noted a $10 million favorable impact from foreign currency throughout the quarter.

Operating income decreased 19% to $146 million in the first-quarter, compared with $181 million in first quarter 2013, as the company continues to invest in its businesses. On the conference call, Amazon noted unit growth rose 23% versus 25% last quarter, while third-party (3P) unit growth was 23%, compared to 25% last quarter.

Analysts surveyed by Thomson Reuters were expecting Amazon to earn 23 cents a share on $19.4 billion in revenue for the quarter. Analysts surveyed by Estimize were expecting Amazon to earn 25 cents a share on $19.63 billion in sales.

After the recent price increase on Amazon Prime, Amazon said it was encouraged by what it's seen so far on Prime, noting that subscribers were growing week-over-week, after the price increase, but that it was still very early. Amazon raised the price of Prime in mid-March to $99 a year, up from $79 a year.


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"We get our energy from inventing on behalf of customers, and 2014 is off to a kinetic start," said Jeff Bezos, founder and CEO of Amazon.com in the press release. "Our device team launched Fire TV, offering great content, including our recently announced exclusive deal with HBO, and innovative features like unified voice search, which we're delighted is being adopted by so many new partners, including Netflix, HBO Go, Hulu Plus, Crackle and Showtime Anytime. The team is working hard to keep Fire TV in stock. Our retail team launched Prime Pantry, a new option available only to Prime members offering exclusive access to everyday essentials in non-bulk sizes -- ranging from breakfast foods and popular soft drinks, to cleaning and personal care items. And, our AWS team significantly lowered prices on EC2, S3 and RDS, saving AWS customers hundreds of millions of dollars over the next several months alone."

Shares of Amazon were slightly lower in after-hours trading, losing 0.2% to $336.63.

When asked about the recent rumors that Amazon was working on its own delivery network, potentially disrupting the relationship it has with UPS (UPS) and to a lesser extent, FedEx (FDX), Amazon wouldn't comment on that, but said that it was continuing to work to get closer and closer to customers.

For the second-quarter, Amazon said it expects net sales to be between $18.1 billion and $19.8 billion, up between 15% and 26% year over year. It expects an operating loss between $55 million and $455 million, compared to $79 million profit for the second quarter 2013.

Shares of Amazon closed the regular session higher, gaining 3.9% to close at $337.15.

--Written by Chris Ciaccia in New York

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