Online Shopping Far Exceeds Expectations

While offline retailers were left slashing prices to lure customers this holiday season, powerhouse portal Yahoo said Wednesday that it had an 86 percent increase in online sales volume over last year, while Microsoft's MSN network experienced a 106 percent increase in sales.

In a sign that the convenience of online shopping is winning over consumers during the bustling holiday season, Yahoo reported sales of $10.3 billion for the fourth quarter of this year, far outpacing analysts' original expectations of a 10 percent growth rate over 2000. MSN, meanwhile, reported sales totaling $5.6 billion.

Yahoo said its sales were led by video game consoles such as Xbox, PlayStation 2, and GameCube, followed by digital cameras, laptop computers, toys, and apparel. MSN also reported strong sales of digital cameras, as well as MP3 players, personal digital assistants, and wireless products.

And just in case holiday revelers didn't care for all the presents they received this season, both Yahoo Shopping and MSN are touting post-holiday, online sales "centers" where users can unload some of their unwanted gifts, and where bargain hunters can scoop up presents their relatives forgot to get them.

Brisk online sales were also reflected in the companies' stock prices Wednesday afternoon as shares of Yahoo surged 8.4 percent to $18.07 while Microsoft stock notched up 2.45 percent to $68.92 a share.