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PRESS RELEASE

Exhibit 99.1

 

LOGO

AMAZON.COM ANNOUNCES THIRD QUARTER SALES UP 27% TO $13.81 BILLION

SEATTLE—(BUSINESS WIRE)—October 25, 2012—Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its third quarter ended September 30, 2012.

Operating cash flow increased 8% to $3.37 billion for the trailing twelve months, compared with $3.11 billion for the trailing twelve months ended September 30, 2011. Free cash flow decreased 31% to $1.06 billion for the trailing twelve months, compared with $1.53 billion for the trailing twelve months ended September 30, 2011.

Common shares outstanding plus shares underlying stock-based awards totaled 469 million on September 30, 2012, consistent with 469 million one year ago.

Net sales increased 27% to $13.81 billion in the third quarter, compared with $10.88 billion in third quarter 2011. Excluding the $348 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales grew 30% compared with third quarter 2011.

Operating loss was $28 million in the third quarter, compared with operating income of $79 million in third quarter 2011. The unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter on operating loss was $3 million.

Net loss was $274 million in the third quarter, or $0.60 per diluted share, compared with net income of $63 million, or $0.14 per diluted share, in third quarter 2011. The third quarter 2012 includes a loss of $169 million, or $0.37 per diluted share, related to our equity-method share of the losses reported by LivingSocial, primarily attributable to its impairment charge of certain assets, including goodwill.

“Our approach is to work hard to charge less. Sell devices near breakeven and you can pack a lot of sophisticated hardware into a very low price point,” said Jeff Bezos, founder and CEO of Amazon.com. “And our approach is working — the $199 Kindle Fire HD is the #1 bestselling product across Amazon worldwide. Incredibly, this is true even as measured by unit sales. The next two bestselling products worldwide are our Kindle Paperwhite and our $69 Kindle. We’re selling more of each of these devices than the #4 bestselling product, book three of the Fifty Shades of Grey series. And we haven’t even started shipping our best tablet — the $299 Kindle Fire HD 8.9” ships November 20.”

Highlights

 

  •  

Compared to the iPad mini, Kindle Fire HD 8.9” has:

 

  ¡    

193% more pixels (2,304,000 pixels vs. 786,432 pixels)

 

  ¡    

56% more pixels-per-inch (254 vs. 163)

 

  ¡    

Watch HD movies and TV — cannot on iPad mini (iPad mini is an SD device)

 

  ¡    

Better audio with dual stereo speakers and Dolby Digital Plus

 

  ¡    

Wi-Fi with dual band, dual antennas + MIMO

 

  ¡    

Costs $30 less

 

  •  

Compared to the iPad mini, Kindle Fire HD 7” has:

 

  ¡    

30% more pixels (1,024,000 vs. 786,432 pixels)

 

  ¡    

33% more pixels per inch (216 vs. 163)

 

  ¡    

Watch HD movies and TV — cannot on iPad mini (iPad mini is an SD device)

 

  ¡    

Better audio with dual stereo speakers and Dolby Digital Plus

 

  ¡    

Wi-Fi with dual band, dual antennas + MIMO

 

  ¡    

Costs $130 less

 

  •  

Amazon.com introduced the fifth generation Kindle e-readers: Kindle Paperwhite is the most advanced e-reader ever constructed with 62% more pixels and 25% increased contrast, a patented built-in front light for reading in all lighting conditions, up to 8 weeks of battery life, and a thin and light design for just $119; Kindle Paperwhite Wi-Fi + 3G — never pay for or hunt for a Wi-Fi hotspot with the all-new top-of-the-line Kindle e-reader with free 3G wireless for just $179; and the new latest generation Kindle, the lightest and smallest Kindle, now with new, improved fonts, faster page turns for just $69.


  •  

Amazon.co.jp launched the Japanese Kindle Store, offering customers a vast selection of over 50,000 Japanese-language Kindle books. In total, the store offers over one million titles, including the largest selection of bestsellers in English and other languages.

 

  •  

Amazon.com announced a new licensing agreement with EPIX for movies including The Avengers, Iron Man 2, The Hunger Games, Super 8, Thor, and more, expanding its catalog of title offerings for Prime Instant Video to more than 30,000 movies and TV episodes.

 

  •  

Amazon announced significant updates to Cloud Player, including scan and match technology which provides customers a fast and easy way to get all of their music from their computers to the cloud. Cloud Player customers can then enjoy their music on their favorite devices, including Kindle Fire, iPhone, iPod Touch, Android devices, Sonos home entertainment systems, and any web browser. Amazon also expanded Cloud Player to the U.K., Germany, France, Italy, and Spain.

 

  •  

Amazon announced it is hiring for more than 50,000 seasonal positions at its fulfillment centers across the U.S. this holiday season. Amazon employs more than 20,000 people across its 40 U.S. fulfillment centers and pays its full-time, permanent employees 30 percent more than what traditional retail store employees earn.

 

  •  

Amazon has announced 19 new fulfillment centers worldwide to be opened in time to support this year’s holiday demand.

 

  •  

North America segment sales, representing amounts earned from retail sales of consumer products (including from sellers) and subscriptions through North America-focused websites, and including amounts earned from Amazon Web Services (AWS), were $7.88 billion, up 33% from third quarter 2011.

 

  •  

International segment sales, representing amounts earned from retail sales of consumer products (including from sellers) and subscriptions through internationally-focused websites, were $5.92 billion, up 20% from third quarter 2011. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 27%.

 

  •  

Worldwide Media sales grew 11% to $4.60 billion. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 14%.

 

  •  

Worldwide Electronics and Other General Merchandise sales grew 36% to $8.56 billion. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 39%.

 

  •  

The NASDAQ OMX Group announced the launch of FinQloud, a cloud computing offering powered by AWS and exclusively designed for the financial services industry. FinQloud provides efficient management and storage of financial data to help market participants streamline operations and meet regulatory compliance requirements without making costly capital expenditures for their underlying infrastructure.

 

  •  

AWS announced that more than 300 government agencies and 1,500 education institutions are leveraging AWS for a wide range of uses including big data analytics, high performance computing, web and collaboration applications, archiving and storage, and disaster relief. AWS also announced new services and features available in the AWS GovCloud (U.S.) Region, including the addition of high performance computing capabilities.

 

  •  

AWS announced Amazon Glacier, a secure, reliable and extremely low cost storage service designed for data archiving and backup. Amazon Glacier is designed for data that is infrequently accessed, yet still important to retain for future reference, and for which retrieval times of several hours are suitable.

Financial Guidance

The following forward-looking statements reflect Amazon.com’s expectations as of October 25, 2012. Our results are inherently unpredictable and may be materially affected by many factors, such as fluctuations in foreign exchange rates, changes in global economic conditions and consumer spending, world events, the rate of growth of the Internet and online commerce and the various factors detailed below.

Fourth Quarter 2012 Guidance

 

  •  

Net sales are expected to be between $20.25 billion and $22.75 billion, or to grow between 16% and 31% compared with fourth quarter 2011.

 

  •  

Operating income (loss) is expected to be between $(490) million and $310 million, compared with $260 million in the prior year period.


  •  

This guidance includes approximately $290 million for stock-based compensation and amortization of intangible assets, and it assumes, among other things, that no additional business acquisitions, investments or legal settlements are concluded and that there are no further revisions to stock-based compensation estimates.

A conference call will be webcast live today at 2 p.m. PT/5 p.m. ET, and will be available for at least three months at www.amazon.com/ir. This call will contain forward-looking statements and other material information regarding the Company’s financial and operating results.

These forward-looking statements are inherently difficult to predict. Actual results could differ materially for a variety of reasons, including, in addition to the factors discussed above, the amount that Amazon.com invests in new business opportunities and the timing of those investments, the mix of products sold to customers, the mix of net sales derived from products as compared with services, the extent to which we owe income taxes, competition, management of growth, potential fluctuations in operating results, international growth and expansion, the outcomes of legal proceedings and claims, fulfillment center optimization, risks of inventory management, seasonality, the degree to which the Company enters into, maintains and develops commercial agreements, acquisitions and strategic transactions, and risks of fulfillment throughput and productivity. Other risks and uncertainties include, among others, risks related to new products, services and technologies, system interruptions, government regulation and taxation, payments and fraud. In addition, the current global economic climate amplifies many of these risks. More information about factors that potentially could affect Amazon.com’s financial results is included in Amazon.com’s filings with the Securities and Exchange Commission (“SEC”), including its most recent Annual Report on Form 10-K and subsequent filings.

Our investor relations website is www.amazon.com/ir and we encourage investors to use it as a way of easily finding information about us. We promptly make available on this website, free of charge, the reports that we file or furnish with the SEC, corporate governance information (including our Code of Business Conduct and Ethics), and select press releases and social media postings.

About Amazon.com

Amazon.com, Inc. (NASDAQ: AMZN), a Fortune 500 company based in Seattle, opened on the World Wide Web in July 1995 and today offers Earth’s Biggest Selection. Amazon.com, Inc. seeks to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. Amazon.com and other sellers offer millions of unique new, refurbished and used items in categories such as Books; Movies, Music & Games; Digital Downloads; Electronics & Computers; Home & Garden; Toys, Kids & Baby; Grocery; Apparel, Shoes & Jewelry; Health & Beauty; Sports & Outdoors; and Tools, Auto & Industrial. Amazon Web Services provides Amazon’s developer customers with access to in-the-cloud infrastructure services based on Amazon’s own back-end technology platform, which developers can use to enable virtually any type of business. Kindle Paperwhite is the most-advanced e-reader ever constructed with 62% more pixels and 25% increased contrast, a patented built-in front light for reading in all lighting conditions, extra-long battery life, and a thin and light design. The new latest generation Kindle, the lightest and smallest Kindle, now features new, improved fonts and faster page turns. Kindle Fire HD features a stunning custom high-definition display, exclusive Dolby audio with dual stereo speakers, high-end, laptop-grade Wi-Fi with dual-band support and dual-antennas/MIMO for 40% faster throughput than other tablets, enough storage for HD content, and the latest generation processor and graphics engine—and it is available in two display sizes—7” and 8.9”. The large-screen Kindle Fire HD is also available with 4G wireless, and comes with a groundbreaking $49.99 introductory 4G LTE data package. The all-new Kindle Fire features a 20% faster processor, 40% faster performance, twice the memory, and longer battery life.

Amazon and its affiliates operate websites, including www.amazon.com, www.amazon.co.uk, www.amazon.de, www.amazon.co.jp, www.amazon.fr, www.amazon.ca, www.amazon.cn, www.amazon.it, and www.amazon.es. As used herein, “Amazon.com,” “we,” “our” and similar terms include Amazon.com, Inc., and its subsidiaries, unless the context indicates otherwise.


AMAZON.COM, INC.

Consolidated Statements of Cash Flows

(in millions)

(unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
    Twelve Months Ended
September 30,
 
     2012     2011     2012     2011     2012     2011  

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

   $ 2,335      $ 2,047      $ 5,269      $ 3,777      $ 2,823      $ 1,539   

OPERATING ACTIVITIES:

            

Net income (loss)

     (274     63        (137     454        40        871   

Adjustments to reconcile net income (loss) to net cash from operating activities:

            

Depreciation of fixed assets, including internal-use software and website development, and other amortization

     554        278        1,497        724        1,856        894   

Stock-based compensation

     217        144        597        397        756        518   

Other operating expense (income), net

     40        37        118        112        161        140   

Losses (gains) on sales of marketable securities, net

     (4     (6     (8     (4     (8     (4

Other expense (income), net

     157        (38     153        (39     137        (56

Deferred income taxes

     (36     34        (117     68        (50     116   

Excess tax benefits from stock-based compensation

     (66     —          (190     (61     (191     (84

Changes in operating assets and liabilities:

            

Inventories

     (647     (587     (25     (517     (1,285     (1,211

Accounts receivable, net and other

     (416     (75     164        211        (913     (320

Accounts payable

     1,223        848        (2,856     (1,687     1,828        1,755   

Accrued expenses and other

     96        109        (373     (9     703        587   

Additions to unearned revenue

     472        239        1,251        706        1,609        892   

Amortization of previously unearned revenue

     (373     (249     (975     (721     (1,275     (984
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) operating activities

     943        797        (901     (366     3,368        3,114   

INVESTING ACTIVITIES:

            

Purchases of fixed assets, including internal-use software and website development

     (716     (529     (1,759     (1,261     (2,310     (1,589

Acquisitions, net of cash acquired, and other

     (37     (48     (711     (656     (759     (927

Sales and maturities of marketable securities and other investments

     742        1,964        3,731        5,931        4,643        7,043   

Purchases of marketable securities and other investments

     (358     (1,287     (1,774     (4,475     (3,556     (6,203
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) investing activities

     (369     100        (513     (461     (1,982     (1,676

FINANCING ACTIVITIES:

            

Excess tax benefits from stock-based compensation

     66        —          190        61        191        84   

Common stock repurchased

     —          —          (960     —          (1,237     —     

Proceeds from long-term debt and other

     109        9        300        131        343        173   

Repayments of long-term debt, capital lease, and finance lease obligations

     (144     (91     (437     (341     (537     (440
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) financing activities

     31        (82     (907     (149     (1,240     (183

Foreign-currency effect on cash and cash equivalents

     40        (39     32        22        11        29   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) in cash and cash equivalents

     645        776        (2,289     (954     157        1,284   

CASH AND CASH EQUIVALENTS, END OF PERIOD

   $ 2,980      $ 2,823      $ 2,980      $ 2,823      $ 2,980      $ 2,823   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL CASH FLOW INFORMATION:

            

Cash paid for interest on long term debt

   $ 7      $ 4      $ 21      $ 10      $ 25      $ 13   

Cash paid for income taxes (net of refunds)

     21        12        60        18        75        31   

Fixed assets acquired under capital leases

     207        155        564        566        751        688   

Fixed assets acquired under build-to-suit leases

     14        54        46        220        85        234   


AMAZON.COM, INC.

Consolidated Statements of Operations

(in millions, except per share data)

(unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2012     2011     2012     2011  

Net product sales (1)

   $ 11,546      $ 9,382      $ 33,586      $ 26,691   

Net services sales (2)

     2,260        1,494        6,239        3,955   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net sales

     13,806        10,876        39,825        30,646   

Operating expenses (3):

        

Cost of sales

     10,319        8,325        29,834        23,457   

Fulfillment

     1,510        1,121        4,161        2,917   

Marketing

     540        370        1,557        1,037   

Technology and content

     1,192        769        3,219        2,047   

General and administrative

     230        175        662        474   

Other operating expense (income), net

     43        37        121        112   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     13,834        10,797        39,554        30,044   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from operations

     (28     79        271        602   

Interest income

     10        16        32        47   

Interest expense

     (22     (17     (65     (45

Other income (expense), net

     18        52        (31     57   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total non-operating income (expense)

     6        51        (64     59   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

     (22     130        207        661   

Provision for income taxes

     (83     (67     (234     (205

Equity-method investment activity, net of tax

     (169     —          (110     (2
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ (274   $ 63      $ (137   $ 454   
  

 

 

   

 

 

   

 

 

   

 

 

 

Basic earnings per share

   $ (0.60   $ 0.14      $ (0.30   $ 1.00   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted earnings per share

   $ (0.60   $ 0.14      $ (0.30   $ 0.99   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares used in computation of earnings per share:

        

Basic

     452        454        452        453   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

     460        461        459        460   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1)     Represents revenue from the sale of products and related shipping fees and digital content where we are the seller of record.

  

(2)     Represents third-party seller fees earned (including commissions) and related shipping fees, digital content subscriptions, and non-retail activities.

   

(3)     Includes stock-based compensation as follows:

  

Fulfillment

   $ 56      $ 35      $ 149      $ 91   

Marketing

     16        10        43        27   

Technology and content

     112        75        310        211   

General and administrative

     33        24        95        68   


AMAZON.COM, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in millions)

(unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2012     2011     2012     2011  

Net income (loss)

   $ (274   $ 63      $ (137   $ 454   

Other comprehensive income (loss):

        

Foreign currency translation adjustments, net of tax of $4, $16, $(17) and $17

     30        (212     16        (46

Change in unrealized gains on available-for-sale securities, net of tax of $0, $0, $(2) and $3

     2        2        4        (5
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other comprehensive income (loss)

     32        (210     20        (51
  

 

 

   

 

 

   

 

 

   

 

 

 

Comprehensive income (loss)

   $ (242   $ (147   $ (117   $ 403   
  

 

 

   

 

 

   

 

 

   

 

 

 


AMAZON.COM, INC.

Segment Information

(in millions)

(unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2012     2011     2012     2011  

North America

        

Net sales

   $ 7,884      $ 5,932      $ 22,638      $ 16,804   

Segment operating expenses (1)

     7,593        5,788        21,655        16,156   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income

   $ 291      $ 144      $ 983      $ 648   
  

 

 

   

 

 

   

 

 

   

 

 

 

International

        

Net sales

   $ 5,922      $ 4,944      $ 17,187      $ 13,842   

Segment operating expenses (1)

     5,981        4,828        17,181        13,379   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income (loss)

   $ (59   $ 116      $ 6      $ 463   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

        

Net sales

   $ 13,806      $ 10,876      $ 39,825      $ 30,646   

Segment operating expenses (1)

     13,574        10,616        38,836        29,535   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income

     232        260        989        1,111   

Stock-based compensation

     (217     (144     (597     (397

Other operating income (expense), net

     (43     (37     (121     (112
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from operations

     (28     79        271        602   

Total non-operating income (expense)

     6        51        (64     59   

Provision for income taxes

     (83     (67     (234     (205

Equity-method investment activity, net of tax

     (169     —          (110     (2
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

   $ (274   $ 63      $ (137   $ 454   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment Highlights:

        

Y/Y net sales growth:

        

North America

     33     44     35     46

International

     20        44        24        42   

Consolidated

     27        44        30        44   

Y/Y segment operating income growth (decline):

        

North America

     102     (23 )%      52     (2 )% 

International

     (151     (46     (99     (29

Consolidated

     (11     (35     (11     (15

Net sales mix:

        

North America

     57     55     57     55

International

     43        45        43        45   
  

 

 

   

 

 

   

 

 

   

 

 

 
     100     100     100     100
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) Represents operating expenses, excluding stock-based compensation and “Other operating expense (income), net,” which are not allocated to segments.


AMAZON.COM, INC.

Supplemental Net Sales Information

(in millions)

(unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2012     2011     2012     2011  

North America

        

Media

   $ 2,215      $ 1,927      $ 6,285      $ 5,397   

Electronics and other general merchandise

     5,061        3,635        14,771        10,435   

Other (1)

     608        370        1,582        972   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total North America

   $ 7,884      $ 5,932      $ 22,638      $ 16,804   
  

 

 

   

 

 

   

 

 

   

 

 

 

International

        

Media

   $ 2,385      $ 2,226      $ 7,142      $ 6,373   

Electronics and other general merchandise

     3,497        2,681        9,924        7,364   

Other (1)

     40        37        121        105   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total International

   $ 5,922      $ 4,944      $ 17,187      $ 13,842   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

        

Media

   $ 4,600      $ 4,153      $ 13,427      $ 11,770   

Electronics and other general merchandise

     8,558        6,316        24,695        17,799   

Other (1)

     648        407        1,703        1,077   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Consolidated

   $ 13,806      $ 10,876      $ 39,825      $ 30,646   
  

 

 

   

 

 

   

 

 

   

 

 

 

Y/Y Net Sales Growth:

        

North America:

        

Media

     15     21     16     20

Electronics and other general merchandise

     39        56        42        62   

Other

     64        77        63        79   

Total North America

     33        44        35        46   

International:

        

Media

     7     27     12     24

Electronics and other general merchandise

     30        63        35        63   

Other

     7        21        15        20   

Total International

     20        44        24        42   

Consolidated:

        

Media

     11     24     14     22

Electronics and other general merchandise

     36        59        39        62   

Other

     59        70        58        70   

Total Consolidated

     27        44        30        44   

Y/Y Net Sales Growth Excluding Effect of Exchange Rates:

        

International:

        

Media

     12     17     15     15

Electronics and other general merchandise

     39        51        41        51   

Other

     13        13        20        13   

Total International

     27        33        29        32   

Consolidated:

        

Media

     14     19     16     17

Electronics and other general merchandise

     39        54        41        58   

Other

     60        69        59        69   

Total Consolidated

     30        39        32        40   

Consolidated Net Sales Mix:

        

Media

     33     38     34     38

Electronics and other general merchandise

     62        58        62        58   

Other

     5        4        4        4   
  

 

 

   

 

 

   

 

 

   

 

 

 
     100     100     100     100
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) Includes non-retail activities, such as AWS in the North America segment, advertising services, our co-branded credit card agreements, and other seller sites in both segments.


AMAZON.COM, INC.

Consolidated Balance Sheets

(in millions, except per share data)

 

     September 30,
2012
    December 31,
2011
 
     (unaudited)        

ASSETS

    

Current assets:

    

Cash and cash equivalents

   $ 2,980      $ 5,269   

Marketable securities

     2,268        4,307   

Inventories

     5,065        4,992   

Accounts receivable, net and other

     2,392        2,571   

Deferred tax assets

     413        351   
  

 

 

   

 

 

 

Total current assets

     13,118        17,490   

Fixed assets, net

     5,662        4,417   

Deferred tax assets

     38        28   

Goodwill

     2,540        1,955   

Other assets

     1,476        1,388   
  

 

 

   

 

 

 

Total assets

   $ 22,834      $ 25,278   
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Current liabilities:

    

Accounts payable

   $ 8,369      $ 11,145   

Accrued expenses and other

     4,236        3,751   
  

 

 

   

 

 

 

Total current liabilities

     12,605        14,896   

Long-term liabilities

     2,676        2,625   

Commitments and contingencies

    

Stockholders’ equity:

    

Preferred stock, $0.01 par value:

    

Authorized shares — 500

    

Issued and outstanding shares — none

     —          —     

Common stock, $0.01 par value:

    

Authorized shares — 5,000

    

Issued shares — 476 and 473

    

Outstanding shares — 453 and 455

     5        5   

Treasury stock, at cost

     (1,837     (877

Additional paid-in capital

     7,863        6,990   

Accumulated other comprehensive loss

     (296     (316

Retained earnings

     1,818        1,955   
  

 

 

   

 

 

 

Total stockholders’ equity

     7,553        7,757   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 22,834      $ 25,278   
  

 

 

   

 

 

 


AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions, except per share data)

(unaudited)

 

     Q3 2011     Q4 2011     Q1 2012     Q2 2012     Q3 2012     Y/Y %
Change
 

Cash Flows and Shares

            

Operating cash flow — trailing twelve months (TTM)

   $ 3,114      $ 3,903      $ 3,051      $ 3,222      $ 3,368        8

Purchases of fixed assets (incl. internal-use software & website development) — TTM

   $ 1,589      $ 1,811      $ 1,899      $ 2,123      $ 2,310        45

Free cash flow (operating cash flow less purchases of fixed assets) — TTM

   $ 1,525      $ 2,092      $ 1,152      $ 1,099      $ 1,058        (31 %) 

Free cash flow — TTM Y/Y growth (decline)

     (17 %)      (17 %)      (39 %)      (40 %)      (31 %)      N/A   

Invested capital (1)

   $ 9,147      $ 9,680      $ 10,006      $ 10,250      $ 10,392        N/A   

Return on invested capital (2)

     17     22     12     11     10     N/A   

Common shares and stock-based awards outstanding

     469        468        464        468        469        0

Common shares outstanding

     455        455        450        452        453        0

Stock-based awards outstanding

     14        14        13        16        16        12

Stock-based awards outstanding — % of common shares outstanding

     3.2     3.0     2.9     3.6     3.6     N/A   

Results of Operations

            

Worldwide (WW) net sales

   $ 10,876      $ 17,431      $ 13,185      $ 12,834      $ 13,806        27

WW net sales — Y/Y growth, excluding F/X

     39     34     34     32     30     N/A   

WW net sales — TTM

   $ 43,594      $ 48,077      $ 51,404      $ 54,325      $ 57,256        31

WW net sales — TTM Y/Y growth, excluding F/X

     39     37     37     35     33     N/A   

Operating income (loss)

   $ 79      $ 260      $ 192      $ 107      $ (28     (135 %) 

Operating income — Y/Y growth (decline), excluding F/X

     (77 %)      (48 %)      (38 %)      (34 %)      (137 %)      N/A   

Operating margin — % of WW net sales

     0.7     1.5     1.5     0.8     (0.2 %)      N/A   

Operating income — TTM

   $ 1,076      $ 862      $ 732      $ 637      $ 531        (51 %) 

Operating income — TTM Y/Y growth (decline), excluding F/X

     (25 %)      (44 %)      (50 %)      (50 %)      (48 %)      N/A   

Operating margin — TTM % of WW net sales

     2.5     1.8     1.4     1.2     0.9     N/A   

Net income (loss)

   $ 63      $ 177      $ 130      $ 7      $ (274     (533 %) 

Net income (loss) per diluted share

   $ 0.14      $ 0.38      $ 0.28      $ 0.01      $ (0.60     (534 %) 

Net income — TTM

   $ 871      $ 631      $ 561      $ 377      $ 40        (95 %) 

Net income per diluted share — TTM

   $ 1.89      $ 1.37      $ 1.22      $ 0.82      $ 0.09        (95 %) 

Segments

            

North America Segment:

            

Net sales

   $ 5,932      $ 9,902      $ 7,427      $ 7,326      $ 7,884        33

Net sales — Y/Y growth, excluding F/X

     44     37     36     36     33     N/A   

Net sales — TTM

   $ 24,014      $ 26,705      $ 28,667      $ 30,587      $ 32,540        36

Operating income

   $ 144      $ 285      $ 349      $ 344      $ 291        102

Operating margin — % of North America net sales

     2.4     2.9     4.7     4.7     3.7     N/A   

Operating income — TTM

   $ 943      $ 933      $ 991      $ 1,120      $ 1,268        34

Operating income — TTM Y/Y growth, excluding F/X

     1     (2 %)      2     14     34     N/A   

Operating margin — TTM % of North America net sales

     3.9     3.5     3.5     3.7     3.9     N/A   

International Segment:

            

Net sales

   $ 4,944      $ 7,529      $ 5,758      $ 5,508      $ 5,922        20

Net sales — Y/Y growth, excluding F/X

     33     29     32     28     27     N/A   

Net sales — TTM

   $ 19,580      $ 21,372      $ 22,737      $ 23,738      $ 24,716        26

Net sales — TTM % of WW net sales

     45     44     44     44     43     N/A   

Operating income (loss)

   $ 116      $ 177      $ 49      $ 16      $ (59     (151 %) 

Operating margin — % of International net sales

     2.4     2.4     0.9     0.3     (1.0 %)      N/A   

Operating income — TTM

   $ 790      $ 640      $ 515      $ 359      $ 183        (77 %) 

Operating income — TTM Y/Y growth (decline), excluding F/X

     (23 %)      (41 %)      (49 %)      (57 %)      (68 %)      N/A   

Operating margin — TTM % of International net sales

     4.0     3.0     2.3     1.5     0.7     N/A   

Consolidated Segments:

            

Operating expenses (3)

   $ 10,616      $ 16,969      $ 12,787      $ 12,474      $ 13,574        28

Operating expenses — TTM (3)

   $ 41,860      $ 46,504      $ 49,899      $ 52,846      $ 55,805        33

Operating income

   $ 260      $ 462      $ 398      $ 360      $ 232        (11 %) 

Operating margin — % of Consolidated sales

     2.4     2.7     3.0     2.8     1.7     N/A   

Operating income — TTM

   $ 1,734      $ 1,573      $ 1,505      $ 1,480      $ 1,451        (16 %) 

Operating income — TTM Y/Y growth (decline), excluding F/X

     (11 %)      (21 %)      (22 %)      (21 %)      (15 %)      N/A   

Operating margin — TTM % of Consolidated net sales

     4.0     3.3     2.9     2.7     2.5     N/A   
            


AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions, except inventory turnover, accounts payable days and employee data)

(unaudited)

 

                                   Y/Y %  
     Q3 2011     Q4 2011     Q1 2012     Q2 2012     Q3 2012     Change  

Supplemental

            

Supplemental North America Segment Net Sales:

            

Media

   $ 1,927      $ 2,562      $ 2,197      $ 1,874      $ 2,215        15

Media — Y/Y growth, excluding F/X

     21     8     17     18     15     N/A   

Media — TTM

   $ 7,767      $ 7,959      $ 8,270      $ 8,559      $ 8,847        14

Electronics and other general merchandise

   $ 3,635      $ 6,881      $ 4,772      $ 4,937      $ 5,061        39

Electronics and other general merchandise — Y/Y growth, excluding F/X

     56     51     44     41     39     N/A   

Electronics and other general merchandise — TTM

   $ 14,992      $ 17,315      $ 18,784      $ 20,226      $ 21,652        44

Electronics and other general merchandise — TTM % of North America net sales

     62     65     66     66     67     N/A   

Other

   $ 370      $ 459      $ 458      $ 515      $ 608        64

Other — TTM

   $ 1,255      $ 1,431      $ 1,613      $ 1,802      $ 2,041        63

Supplemental International Segment Net Sales:

            

Media

   $ 2,226      $ 3,447      $ 2,513      $ 2,245      $ 2,385        7

Media — Y/Y growth, excluding F/X

     17     18     22     12     12     N/A   

Media — TTM

   $ 9,238      $ 9,820      $ 10,261      $ 10,431      $ 10,590        15

Electronics and other general merchandise

   $ 2,681      $ 4,032      $ 3,203      $ 3,224      $ 3,497        30

Electronics and other general merchandise — Y/Y growth, excluding F/X

     51     41     42     42     39     N/A   

Electronics and other general merchandise — TTM

   $ 10,199      $ 11,397      $ 12,314      $ 13,139      $ 13,956        37

Electronics and other general merchandise — TTM % of International net sales

     52     53     54     55     56     N/A   

Other

   $ 37      $ 50      $ 42      $ 39      $ 40        7

Other — TTM

   $ 143      $ 155      $ 162      $ 168      $ 170        19

Supplemental Worldwide Net Sales:

            

Media

   $ 4,153      $ 6,009      $ 4,710      $ 4,119      $ 4,600        11

Media — Y/Y growth, excluding F/X

     19     14     19     15     14     N/A   

Media — TTM

   $ 17,005      $ 17,779      $ 18,531      $ 18,990      $ 19,437        14

Electronics and other general merchandise

   $ 6,316      $ 10,913      $ 7,975      $ 8,161      $ 8,558        36

Electronics and other general merchandise — Y/Y growth, excluding F/X

     54     47     43     42     39     N/A   

Electronics and other general merchandise — TTM

   $ 25,191      $ 28,712      $ 31,098      $ 33,365      $ 35,608        41

Electronics and other general merchandise — TTM % of WW net sales

     58     60     60     61     62     N/A   

Other

   $ 407      $ 509      $ 500      $ 554      $ 648        59

Other — TTM

   $ 1,398      $ 1,586      $ 1,775      $ 1,970      $ 2,211        58

Balance Sheet

            

Cash and marketable securities

   $ 6,326      $ 9,576      $ 5,715      $ 4,970      $ 5,248        (17 %) 

Inventory, net — ending

   $ 3,770      $ 4,992      $ 4,255      $ 4,380      $ 5,065        34

Inventory turnover, average — TTM

     10.8        10.3        10.4        10.1        9.7        (10 %) 

Fixed assets, net

   $ 3,999      $ 4,417      $ 4,653      $ 5,097      $ 5,662        42

Accounts payable — ending

   $ 6,552      $ 11,145      $ 6,886      $ 7,072      $ 8,369        28

Accounts payable days — ending

     72        74        62        68        75        3

Other

            

WW shipping revenue

   $ 360      $ 531      $ 461      $ 469      $ 517        44

WW shipping costs

   $ 918      $ 1,466      $ 1,129      $ 1,054      $ 1,153        26

WW net shipping costs

   $ 558      $ 935      $ 668      $ 585      $ 636        14

WW net shipping costs — % of WW net sales

     5.1     5.4     5.1     4.6     4.6     N/A   

Employees (full-time and part-time; excludes contractors & temporary personnel)

     51,300        56,200        65,600        69,100        81,400        59

 

(1) Average Total Assets minus Current Liabilities (excluding current portion of Long Term Debt) over five quarter ends.
(2) TTM Free Cash Flow divided by Invested Capital.
(3) Represents cost of sales, fulfillment, marketing, technology and content, and general and administrative operating expenses, excluding stock-based compensation.


Amazon.com, Inc.

Certain Definitions

Customer Accounts

 

  •  

References to customers mean customer accounts, which are unique e-mail addresses, established either when a customer places an order or when a customer orders from other sellers on our websites. Customer accounts exclude certain customers, including customers associated with certain of our acquisitions, Amazon Enterprise Solutions program customers, Amazon.com Payments customers, Amazon Web Services customers, and the customers of select companies with whom we have a technology alliance or marketing and promotional relationship. Customers are considered active when they have placed an order during the preceding twelve-month period.

Seller Accounts

 

  •  

References to sellers means seller accounts, which are established when a seller receives an order from a customer account. Seller accounts exclude Amazon Enterprise Solutions sellers. Sellers are considered active when they have received an order from a customer during the preceding twelve-month period.

Registered Developers

 

  •  

References to registered developers mean cumulative registered developer accounts, which are established when potential developers enroll with Amazon Web Services and receive a developer access key.

Units

 

  •  

References to units mean physical and digital units sold (net of returns and cancellations) by us and sellers at Amazon domains worldwide – for example www.amazon.com, www.amazon.co.uk, www.amazon.de, www.amazon.co.jp, www.amazon.fr, www.amazon.ca, www.amazon.cn, www.amazon.it, www.amazon.es, www.diapers.com, www.shopbop.com and www.zappos.com – as well as Amazon-owned items sold through non-Amazon domains. Units sold are paid units and do not include units associated with certain acquisitions, rental businesses, web services or advertising businesses, or Amazon gift certificates.

 

Contacts:  
Amazon.com Investor Relations   Amazon.com Public Relations
Sean Boyle, 206/266-2171   Mary Osako, 206/266-7180
www.amazon.com/ir  
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