Amazon has long talked up its future in India, a huge potential market with a fast-growing growing middle class. The online retailing giant has invested heavily in the country to build warehouses and increase its selection there to more than 25 million products.
The attention seems to be paying off. Amazon said Thursday that Amazon India continues to be its fastest growing country in terms of sales. Not surprisingly, more investment —perhaps as much as $5 billion — is on the way. But in typical Amazon fashion, the company gave no specifics.
“When we see a positive surprise we double down on it,” Amazon’s new CFO, Brian Olsavsk, said during the company’s second quarter earnings call. “India is that kind of surprise.”
India’s growing economy and increasing wealth is certainly behind some of the growth. But part of it may also be because of Amazon introducing Sunday delivery across 100 cities in India for all Amazon-fulfilled products at no additional cost.
Last year, Amazon founder and CEO Jeff Bezos said that at the current scale and growth rates, India was on track to the company’s fastest country to reach $1 billion dollars in gross sales. At the time, Amazon announced it was investing $2 billion into the region.
While Amazon doesn’t break out revenue by region, Amazon’s international sales for the marketplace business grew 3% in the second quarter to $7.6 billion.
“We are very happy with the trajectory in that region,” Olsavsk said later in the call. It’s worth noting Amazon is not without competition in India. Online retailer Flipkart has raised $2.7 billion to take on Amazon in India, and Softbank recently put $627 million in competitor Snapdeal.
Unfortunately, it’s a mixed bag for other fast-growing regions in Asia, such as China. Amazon says it has tripled the selection of products available through the Amazon Global Store on Amazon.cn, which means Chinese shoppers can choose to buy from three million products curated from the U.S. Amazon website.
Earlier this year, Amazon was forced to open a store on rival Alibaba’s online mall, Tmall, which sells goods to Chinese consumers from brands like Nike, Apple and P&G. According to iResearch, Amazon China’s e-commerce market share in China remains is less than 1.5%.
Meanwhile, Amazon said Thursday that its overall second quarter revenue grew 20% to $23.2 billion. Amazon, typically a money loser, even said it made a rare profit of $92 million, up from a loss of $126 million in the same period a year earlier.
Shares in the company (AMZN) rose 17% in after hours trading to $566, pushing its market value above that of retailing giant Wal-Mart (WMT).