Amazon delivers--big time

Amazon reported its first quarter earnings that handily beat expectations. It also sees clear sailing in the second quarter.

Amazon reported net income of $111 million, or 26 cents a share, for the quarter ending March 31. Wall Street was expecting earnings of 15 cents a share according to Thomson Financial. It's unclear how much of that gain came from lower taxes. Amazon said its first quarter "effective tax rate was 23 percent compared with an effective tax rate of 47 percent in first quarter 2006."

Sales in the quarter jumped 32 percent from a year ago to $3.02 billion. Wall Street was expecting $2.92 billion.

As for the outlook Amazon projected revenue of $2.7 billion to $2.85 billion compared to Wall Street estimates of $2.7 billion. For the year, Amazon sees revenue of $13.4 billion to $14 billion compared to Wall Street estimates of $13.4 billion.

Among other notable items:

• North American sales were $1.62 billion, up 30 percent from a year ago. International sales were $1.39 billion, up 35 percent from a year ago.
• Media sales were $1.99 billion, up 26 percent from a year ago.
• More than 240,000 developers have used Amazon Web Services. Amazon S3 has more than 5 million data objects stored.
• The company has authorized plans to buy back up to $500 million Amazon shares over the next 24 months.
• Amazon had $1 billion in cash and equivalents as of March 31.
• Purchases of fixed assets such as internal software and Web site development tools were down 8 percent from a year ago to $205 million. This may indicate that Amazon's capital spending spree is decelerating.
• Amazon had 14,000 employees as of March 31.
• Outbound shipping costs were $238 million, up 21 percent from a year ago. Net shipping costs were $87 million in the quarter compared to $68 million a year ago.