Following a strong showing from the world’s largest online movie rental service, the United States’ No. 1 Internet-based retailer reported that net sales for the quarter ending Dec. 31 grew 18 percent year-over-year.

 

Officials at Amazon.com, Inc. say net sales grew to $6.7 billion for the three-month period, and that net income increased 9 percent year-over-year – from $207 million to $225 million. Earnings per share grew from 48 cents to 52 cents over the same period, according to the Seattle-based company.

 

Amazon’s iconic founder and chief executive officer, Jeff Bezos, said the company remains “relentlessly focused on serving customers with low prices, great selection and free shipping offers, including Amazon Prime.”

 

“We’re particularly grateful for the unusually strong demand for Kindle in the fourth quarter,” Bezos added, referring to the company’s “e-book reader,” or an embedded system for reading electronic books.

 

For the year, net sales grew 28 percent over 2007, to $19.17 billion, Amazon said, with net income growing 36 percent – from $476 million to $645 million – and earnings per share increasing from $1.12 to $1.49.

 

The figures mark a ray of hope as this recession takes hold and large companies announce poor earnings reports, lowered outlooks and layoffs.

 

It’s been a good week for Internet-based services in the United States.

 

On Tuesday, Netflix, Inc. reported that its subscribership grew 26 percent year-over-year from the fourth quarter of 2007 to 2008. Officials at Netflix also say that revenues grew 19 percent, to $359.6 million, for the three-month period that ended Dec. 31, and grew 5 percent from the prior quarter. Total annual for fiscal year 2008 was $1.365 billion, up 13 percent from 2007, the company says.

 

“Consumers embraced the Netflix experience in near record numbers last quarter, with growth in our core DVD offering and growing momentum with Internet streaming,” said Reed Hastings, Netflix co-founder and chief executive officer.

 

Yet for many companies, the recession is forcing layoffs and spending cuts – in some cases, targeting marketing budgets.

 

That’s a move that TMC (News - Alert) President Rich Tehrani questions in a widely read blog entry here, titled “Keep Your Company from Being Cut in a Recession.”

 

For Tehrani, in this environment, the people who make purchasing decisions will look to purchase from companies they deem stable.

 

“How do they determine stability?” he asks. “Through outward appearance.”

Small companies and those who have reported negative earnings are at greatest risk, Tehrani says, mostly because customers know small companies are not generally well-capitalized.

“In response, all companies need to over saturate the markets they serve with the best news they can create,” Tehrani said. “This is regardless of how well they are doing. If sales are generally good now, it makes even more sense to focus on putting a halo around your brand to protect it from bad times which may or may not be ahead. Customer wins, new product launches, a new green data center, a widget that does something useful – if you have any of these, issue a release and try to get some positive media coverage.”

 

Even Bezos of Google (News - Alert) took the opportunity in his company’s earnings report to plug a product that’s been updated recently, Kindle.

 

The Kindle Store itself contains the largest collection of e-books available anywhere in the world –and selection increased by 45,000 titles in the fourth quarter, bringing the total to 230,000 titles.

 

That’s part of what’s driving Amazon’s positive outlook for this year.

 

The company is calling for first-quarter growth between 9 and 19 percent, to about $4.525 billion to $4.925 billion.

 

“Operating income is expected to be between $125 million and $210 million, or between 37 percent decline and 6 percent growth compared with first quarter 2008,” company officials say.