Online retailer Amazon.com has at long last achieved what many thought it never would: the company is - wait for it - making money.

Seattle-based Amazon, which primarily sells books and music, posted its first ever quarterly net profit in the three months ending December 31, beating its own forecasts and Wall Street's expectations. Boosted by strong Christmas sales, the company earned $5m (£3.5m), or 1 cent per share, compared with a net loss of $545m for the same quarter last year.

The company also recorded a pro forma net profit, which excludes certain costs such as losses from investments, of $35m, or 9 cents per share, compared with a loss of $90m, or 25 cents per share, from October to December 2000.

Analysts polled by Thomson Financial/First Call had predicted a pro forma net loss of 7 cents per share.

Sales for the quarter were up by 15%, with Amazon posting net sales of $1.12bn, reflecting those solid holiday sales despite what was for many US retailers a lacklustre season.

The company still lost money for the fiscal year ended December 31, recording a net loss of $567.2m, but that compares favourably with a net loss of $1.41bn the previous year.