"By comparative retail standards, Amazon's level of profitability is still painfully weak," said Neil Saunders, head of retail analyst firm Conlumino, who is still positive on Amazon's prospects.
"For every dollar the company takes, it makes just 0.75 of a cent in profit." Amazon chief financial officer Brian Olsavsky defended the results, adding that foreign exchange rates had an unexpectedly large impact, but overall the company had "a very strong quarter and a strong year."
He said that Amazon would continue to spend on projects including its cloud computing and Prime services, with plans to add more original video content.
The company is gearing up to stream highly anticipated programmes including Woody Allen's first TV series, which will star Miley Cyrus, and a car show fronted by former Top Gear trio Jeremy Clarkson, James May and Richard Hammond.
Olsavsky added "the investments will ebb and flow over time, but our focus on cost reductions and improvement on customer experience will be constant."
New star: Jeremy Clarkson will present a TV show on Amazon (Picture: Jeremy Clarkson)
Jeremy Selwyn
Amazon reported a 51% rise in membership of Prime, which analysts have estimated has about 50 million subscribers worldwide.
