EX-99.1 2 d281819dex991.htm PRESS RELEASE DATED JANUARY 31, 2012 Press Release dated January 31, 2012

Exhibit 99.1

LOGO

AMAZON.COM ANNOUNCES FOURTH QUARTER SALES UP 35% TO $17.43 BILLION;

KINDLE DEVICE SALES NEARLY TRIPLE DURING THE HOLIDAYS

SEATTLE—(BUSINESS WIRE)—January 31, 2012—Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its fourth quarter ended December 31, 2011.

Operating cash flow increased 12% to $3.90 billion for the trailing twelve months, compared with $3.50 billion for the trailing twelve months ended December 31, 2010. Free cash flow decreased 17% to $2.09 billion for the trailing twelve months, compared with $2.52 billion for the trailing twelve months ended December 31, 2010.

Common shares outstanding plus shares underlying stock-based awards totaled 468 million on December 31, 2011, compared with 465 million a year ago.

Net sales increased 35% to $17.43 billion in the fourth quarter, compared with $12.95 billion in fourth quarter 2010. Excluding the $101 million favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales would have grown 34% compared with fourth quarter 2010.

Operating income was $260 million in the fourth quarter, compared with $474 million in fourth quarter 2010. The favorable impact from year-over-year changes in foreign exchange rates throughout the quarter on operating income was $5 million.

Net income decreased 58% to $177 million in the fourth quarter, or $0.38 per diluted share, compared with net income of $416 million, or $0.91 per diluted share, in fourth quarter 2010.

“We are grateful to the millions of customers who purchased the Kindle Fire and Kindle e-reader devices this holiday season, making Kindle our bestselling product across both the U.S. and Europe,” said Jeff Bezos, founder and CEO of Amazon.com. “Our millions of third-party sellers had a tremendous holiday season with 65% unit growth and now represent 36% of total units sold.”

Full Year 2011

Net sales increased 41% to $48.08 billion, compared with $34.20 billion in 2010. Excluding the $1.09 billion favorable impact from year-over-year changes in foreign exchange rates throughout the year, net sales would have grown 37% compared with 2010.

Operating income decreased 39% to $862 million, compared with $1.41 billion in 2010. The favorable impact from year-over-year changes in foreign exchange rates throughout the year on operating income was $53 million.

Net income decreased 45% to $631 million in 2011, or $1.37 per diluted share, compared with net income of $1.15 billion, or $2.53 per diluted share, in 2010.

Highlights

 

   

During the nine-week holiday period ending December 31, 2011, Kindle unit sales, including both the Kindle Fire and e-reader devices, increased 177% over the same period last year.

 

   

Kindle Fire is the #1 bestselling, most gifted, and most wished for product across the millions of items available on Amazon.com since its introduction 17 weeks ago.

 

1


   

Amazon launched Kindle Stores at Amazon.it and Amazon.es. Kindle moved to the top of the bestseller list on launch day in both countries and held the top spot this holiday season. The new Kindle was also the bestselling product on Amazon.co.uk, Amazon.de and Amazon.fr.

 

   

Amazon.com announced the Kindle Owners’ Lending Library, a benefit of Prime membership that offers over 80,000 books to borrow for free – including over 100 current and former New York Times bestsellers – as frequently as a book a month, with no due dates.

 

   

Kindle Direct Publishing (KDP) announced KDP Select, an annual fund of at least $6 million dedicated to independent authors and publishers who participate in the Kindle Owners’ Lending Library. In December alone, customers borrowed 295,000 KDP Select titles, and KDP Select has helped grow the total library selection of books by over 16X.

 

   

Amazon continued to expand its catalog of title offerings for Prime Instant Video, announcing licensing agreements with Twentieth Century Fox Television Distribution, which added the popular FOX and FX television shows Glee and Sons of Anarchy, and Disney-ABC Television, which added popular television shows including Lost and Grey’s Anatomy. These deals bring the total number of Prime Instant Videos to more than 13,000 movies and TV shows from partners such as CBS, Fox, NBCUniversal, Sony, Warner Bros., PBS, ABC-Disney and many more.

 

   

The number of videos purchased or rented from Amazon Instant Video and the number of Amazon Instant Video customers both more than doubled year-over-year in the fourth quarter. In addition, the number of Prime Instant Video streams increased nearly 300% in the fourth quarter compared to the third quarter.

 

   

Amazon Appstore for Android customers nearly tripled in the fourth quarter compared to the third quarter. In addition, customers downloaded more apps from the Amazon Appstore during the fourth quarter than they had during all previous quarters combined.

 

   

North America segment sales, representing the Company’s U.S. and Canadian sites, were $9.90 billion, up 37% from fourth quarter 2010.

 

   

International segment sales, representing the Company’s U.K., German, Japanese, French, Chinese, Italian and Spanish sites, were $7.53 billion, up 31% from fourth quarter 2010. Excluding the favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 29%.

 

   

Worldwide Media sales grew 15% to $6.01 billion. Excluding the favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 14%.

 

   

Worldwide Electronics and Other General Merchandise sales grew 48% to $10.91 billion. Excluding the favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 47%.

 

   

Amazon Web Services (AWS) announced the launch of its new South America (Sao Paulo) Region and U.S. West (Oregon) Region, bringing the total to eight geographic regions worldwide to which the company has deployed its global cloud computing services.

 

   

AWS announced the launch of Amazon DynamoDB, a fully managed NoSQL database service that provides extremely fast and predictable performance with seamless scalability. With a few clicks in the AWS Management Console, customers can launch a new Amazon DynamoDB database table, scale up or down their request capacity for the table without downtime or performance degradation, and gain visibility into resource utilization and performance metrics.

 

   

AWS announced that customers can now run their Microsoft Windows Server applications within the AWS Free Usage Tier – a program designed to help new AWS customers get started in the cloud. Developers and businesses with Windows Server applications can take advantage of 750 hours of Amazon Elastic Compute Cloud (Amazon EC2) Micro Instance usage per month, at no charge for a one-year period.

Financial Guidance

The following forward-looking statements reflect Amazon.com’s expectations as of January 31, 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.

First Quarter 2012 Guidance

 

   

Net sales are expected to be between $12.0 billion and $13.4 billion, or to grow between 22% and 36% compared with first quarter 2011.

 

2


   

Operating income (loss) is expected to be between $(200) million and $100 million, or between 162% decline and 69% decline compared with first quarter 2011.

 

   

This guidance includes approximately $200 million for stock-based compensation and amortization of intangible assets, and it assumes, among other things, that no additional business acquisitions or investments 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. The new latest generation Kindle is the lightest, most compact Kindle ever and features the same 6-inch, most advanced electronic ink display that reads like real paper even in bright sunlight. Kindle Touch is a new addition to the Kindle family with an easy-to-use touch screen that makes it easier than ever to turn pages, search, shop, and take notes – still with all the benefits of the most advanced electronic ink display. Kindle Touch 3G is the top of the line e-reader and offers the same new design and features of Kindle Touch, with the unparalleled added convenience of free 3G. Kindle Fire is the Kindle for movies, TV shows, music, books, magazines, apps, games and web browsing with all the content, free storage in the Amazon Cloud, Whispersync, Amazon Silk (Amazon’s new revolutionary cloud-accelerated web browser), vibrant color touch screen, and powerful dual-core processor.

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.

 

3


Consolidated Statements of Cash Flows

(in millions)

(unaudited)

 

     Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
     2011     2010     2011     2010  

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

   $ 2,823      $ 1,539      $ 3,777      $ 3,444   

OPERATING ACTIVITIES:

        

Net income

     177        416        631        1,152   

Adjustments to reconcile net income to net cash from operating activities:

        

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

     359        170        1,083        568   

Stock-based compensation

     159        120        557        424   

Other operating expense (income), net

     43        29        154        106   

Losses (gains) on sales of marketable securities, net

     —          —          (4     (2

Other expense (income), net

     (16     (17     (56     (79

Deferred income taxes

     67        48        136        4   

Excess tax benefits from stock-based compensation

     (1     (23     (62     (259

Changes in operating assets and liabilities:

        

Inventories

     (1,260     (693     (1,777     (1,019

Accounts receivable, net and other

     (1,077     (531     (866     (295

Accounts payable

     4,684        3,442        2,997        2,373   

Accrued expenses and other

     1,076        596        1,067        740   

Additions to unearned revenue

     358        186        1,064        687   

Amortization of previously unearned revenue

     (300     (263     (1,021     (905
  

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) operating activities

     4,269        3,480        3,903        3,495   

INVESTING ACTIVITIES:

        

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

     (550     (328     (1,811     (979

Acquisitions, net of cash acquired, and other

     (49     (271     (705     (352

Sales and maturities of marketable securities and other investments

     912        1,112        6,843        4,250   

Purchases of marketable securities and other investments

     (1,782     (1,728     (6,257     (6,279
  

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) investing activities

     (1,469     (1,215     (1,930     (3,360

FINANCING ACTIVITIES:

        

Excess tax benefits from stock-based compensation

     1        23        62        259   

Common stock repurchased

     (277     —          (277     —     

Proceeds from long-term debt and other

     47        43        177        143   

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

     (104     (100     (444     (221
  

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used in) financing activities

     (333     (34     (482     181   

Foreign-currency effect on cash and cash equivalents

     (21     7        1        17   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) in cash and cash equivalents

     2,446        2,238        1,492        333   

CASH AND CASH EQUIVALENTS, END OF PERIOD

   $ 5,269      $ 3,777      $ 5,269      $ 3,777   
  

 

 

   

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL CASH FLOW INFORMATION:

        

Cash paid for interest on long term debt

   $ 4      $ 3      $ 14      $ 11   

Cash paid for income taxes (net of refunds)

     15        13        33        75   

Fixed assets acquired under capital leases

     187        122        753        405   

Fixed assets acquired under build-to-suit leases

     39        14        259        172   


AMAZON.COM, INC.

Consolidated Statements of Operations

(in millions, except per share data)

(unaudited)

 

     Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
     2011     2010     2011     2010  

Product sales

   $ 15,309      $ 11,729      $ 42,000      $ 30,792   

Services sales

     2,122        1,219        6,077        3,412   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net sales

     17,431        12,948        48,077        34,204   

Operating expenses (1):

        

Cost of sales

     13,830        10,317        37,288        26,561   

Fulfillment

     1,659        1,090        4,576        2,898   

Marketing

     593        376        1,630        1,029   

Technology and content

     862        519        2,909        1,734   

General and administrative

     184        143        658        470   

Other operating expense (income), net

     43        29        154        106   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     17,171        12,474        47,215        32,798   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income from operations

     260        474        862        1,406   

Interest income

     14        14        61        51   

Interest expense

     (20     (11     (65     (39

Other income (expense), net

     19        29        76        79   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total non-operating income (expense)

     13        32        72        91   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

     273        506        934        1,497   

Provision for income taxes

     (86     (84     (291     (352

Equity-method investment activity, net of tax

     (10     (6     (12     7   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 177      $ 416      $ 631      $ 1,152   
  

 

 

   

 

 

   

 

 

   

 

 

 

Basic earnings per share

   $ 0.39      $ 0.93      $ 1.39      $ 2.58   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted earnings per share

   $ 0.38      $ 0.91      $ 1.37      $ 2.53   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares used in computation of earnings per share:

        

Basic

     455        450        453        447   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

     462        458        461        456   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

        

(1)    Includes stock-based compensation as follows:

        

Fulfillment

   $ 42      $ 25      $ 133      $ 90   

Marketing

     12        7        39        27   

Technology and content

     80        63        292        223   

General and administrative

     25        24        93        84   


AMAZON.COM, INC.

Segment Information

(in millions)

(unaudited)

 

     Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
     2011     2010     2011     2010  

North America

        

Net sales

   $ 9,902      $ 7,211      $ 26,705      $ 18,707   

Segment operating expenses (1)

     9,617        6,916        25,772        17,752   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income

   $ 285      $ 295      $ 933      $ 955   
  

 

 

   

 

 

   

 

 

   

 

 

 

International

        

Net sales

   $ 7,529      $ 5,737      $ 21,372      $ 15,497   

Segment operating expenses (1)

     7,352        5,410        20,732        14,516   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income

   $ 177      $ 327      $ 640      $ 981   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

        

Net sales

   $ 17,431      $ 12,948      $ 48,077      $ 34,204   

Segment operating expenses

     16,969        12,326        46,504        32,268   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment operating income

     462        622        1,573        1,936   

Stock-based compensation

     (159     (119     (557     (424

Other operating income (expense), net

     (43     (29     (154     (106
  

 

 

   

 

 

   

 

 

   

 

 

 

Income from operations

     260        474        862        1,406   

Total non-operating income (expense)

     13        32        72        91   

Provision for income taxes

     (86     (84     (291     (352

Equity-method investment activity, net of tax

     (10     (6     (12     7   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 177      $ 416      $ 631      $ 1,152   
  

 

 

   

 

 

   

 

 

   

 

 

 

Segment Highlights:

        

Y/Y net sales growth:

        

North America

     37     45     43     46

International

     31        26        38        33   

Consolidated

     35        36        41        40   

Y/Y segment operating income growth (decline):

        

North America

     (4 ) %      6     (2 )%      35

International

     (46     3        (35     14   

Consolidated

     (26     4        (19     23   

Net sales mix:

        

North America

     57     56     56     55

International

     43        44        44        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
December 31,
    Twelve Months Ended
December 31,
 
     2011     2010     2011     2010  

North America

        

Media

   $ 2,562      $ 2,370      $ 7,959      $ 6,881   

Electronics and other general merchandise

     6,881        4,558        17,315        10,998   

Other (1)

     459        283        1,431        828   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total North America

   $ 9,902      $ 7,211      $ 26,705      $ 18,707   
  

 

 

   

 

 

   

 

 

   

 

 

 

International

        

Media

   $ 3,447      $ 2,865      $ 9,820      $ 8,007   

Electronics and other general merchandise

     4,032        2,834        11,397        7,365   

Other (1)

     50        38        155        125   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total International

   $ 7,529      $ 5,737      $ 21,372      $ 15,497   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

        

Media

   $ 6,009      $ 5,235      $ 17,779      $ 14,888   

Electronics and other general merchandise

     10,913        7,392        28,712        18,363   

Other (1)

     509        321        1,586        953   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Consolidated

   $ 17,431      $ 12,948      $ 48,077      $ 34,204   
  

 

 

   

 

 

   

 

 

   

 

 

 

Y/Y Net Sales Growth:

        

North America:

        

Media

     8     13     16     15

Electronics and other general merchandise

     51        71        57        74   

Other

     62        45        73        50   

Total North America

     37        45        43        46   

International:

        

Media

     20     11     23     18

Electronics and other general merchandise

     42        46        55        54   

Other

     32        6        24        22   

Total International

     31        26        38        33   

Consolidated:

        

Media

     15     12     19     17

Electronics and other general merchandise

     48        60        56        66   

Other

     58        39        66        46   

Total Consolidated

     35        36        41        40   

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

        

International:

        

Media

     18     13     16     18

Electronics and other general merchandise

     41        50        47        57   

Other

     31        10        18        24   

Total International

     29        29        31        34   

Consolidated:

        

Media

     14     13     16     16

Electronics and other general merchandise

     47        62        53        67   

Other

     58        40        66        46   

Total Consolidated

     34        37        37        40   

Consolidated Net Sales Mix:

        

Media

     34     40     37     43

Electronics and other general merchandise

     63        57        60        54   

Other

     3        3        3        3   
  

 

 

   

 

 

   

 

 

   

 

 

 
     100     100     100     100
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) Includes non-retail activities, such as AWS, miscellaneous marketing and promotional agreements, other seller sites, and co-branded credit card agreements


AMAZON.COM, INC.

Consolidated Balance Sheets

(in millions, except per share data)

 

     December 31,
2011
    December 31,
2010
 
     (unaudited)        

ASSETS

    

Current assets:

    

Cash and cash equivalents

   $ 5,269      $ 3,777   

Marketable securities

     4,307        4,985   

Inventories

     4,992        3,202   

Accounts receivable, net and other

     2,571        1,587   

Deferred tax assets

     351        196   
  

 

 

   

 

 

 

Total current assets

     17,490        13,747   

Fixed assets, net

     4,417        2,414   

Deferred tax assets

     28        22   

Goodwill

     1,955        1,349   

Other assets

     1,388        1,265   
  

 

 

   

 

 

 

Total assets

   $ 25,278      $ 18,797   
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Current liabilities:

    

Accounts payable

   $ 11,145      $ 8,051   

Accrued expenses and other

     3,751        2,321   
  

 

 

   

 

 

 

Total current liabilities

     14,896        10,372   

Long-term liabilities

     2,625        1,561   

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 — 473 and 468

    

Outstanding shares — 455 and 451

     5        5   

Treasury stock, at cost

     (877     (600

Additional paid-in capital

     6,990        6,325   

Accumulated other comprehensive loss

     (316     (190

Retained earnings

     1,955        1,324   
  

 

 

   

 

 

 

Total stockholders’ equity

     7,757        6,864   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 25,278      $ 18,797   
  

 

 

   

 

 

 


AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions, except per share data)

(unaudited)

 

                                   Y/Y %
Change
 
     Q4 2010     Q1 2011     Q2 2011     Q3 2011     Q4 2011    

Cash Flows and Shares

            

Operating cash flow — trailing twelve months (TTM)

   $ 3,495      $ 3,033      $ 3,205      $ 3,114      $ 3,903        12

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

   $ 979      $ 1,138      $ 1,374      $ 1,589      $ 1,811        85

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

   $ 2,516      $ 1,895      $ 1,831      $ 1,525      $ 2,092        (17 %) 

Free cash flow — TTM Y/Y growth

     (14 %)      (18 %)      (8 %)      (17 %)      (17 %)      N/A   

Invested capital (1)

   $ 7,380      $ 7,931      $ 8,551      $ 9,147      $ 9,680        31

Return on invested capital (2)

     34     24     21     17     22     N/A   

Common shares and stock-based awards outstanding

     465        466        468        469        468        1

Common shares outstanding

     451        452        454        455        455        1

Stock-based awards outstanding

     15        14        15        14        14        (7 %) 

Stock-based awards outstanding — % of common shares outstanding

     3.2     3.1     3.2     3.2     3.0     N/A   

Results of Operations

            

Worldwide (WW) net sales

   $ 12,948      $ 9,857      $ 9,913      $ 10,876      $ 17,431        35

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

     37     36     44     39     34     N/A   

WW net sales — TTM

   $ 34,204      $ 36,931      $ 40,278      $ 43,594      $ 48,077        41

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

     40     39     39     39     37     N/A   

Operating income

   $ 474      $ 322      $ 201      $ 79      $ 260        (45 %) 

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

     3     (20 )%      (36 %)      (77 %)      (48 %)      N/A   

Operating margin — % of WW net sales

     3.7     3.3     2.0     0.7     1.5     N/A   

Operating income — TTM

   $ 1,406      $ 1,334      $ 1,265      $ 1,076      $ 862        (39 %) 

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

     27     7     (7 )%      (25 %)      (44 %)      N/A   

Operating margin — TTM % of WW net sales

     4.1     3.6     3.1     2.5     1.8     N/A   

Net income

   $ 416      $ 201      $ 191      $ 63      $ 177        (58 %) 

Net income per diluted share

   $ 0.91      $ 0.44      $ 0.41      $ 0.14      $ 0.38        (58 %) 

Net income — TTM

   $ 1,152      $ 1,054      $ 1,038      $ 871      $ 631        (45 %) 

Net income per diluted share — TTM

   $ 2.53      $ 2.30      $ 2.26      $ 1.89      $ 1.37        (46 %) 

Segments

            

North America Segment:

            

Net sales

   $ 7,211      $ 5,465      $ 5,406      $ 5,932      $ 9,902        37

Net sales — Y/Y growth, excluding F/X

     45     45     50     44     37     N/A   

Net sales — TTM

   $ 18,707      $ 20,392      $ 22,208      $ 24,014      $ 26,705        43

Operating income

   $ 295      $ 290      $ 214      $ 144      $ 285        (4 %) 

Operating margin — % of North America net sales

     4.1     5.3     4.0     2.4     2.9     N/A   

Operating income — TTM

   $ 955      $ 972      $ 986      $ 943      $ 933        (2 %) 

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

     35     17     9     1     (2 %)      N/A   

Operating margin — TTM % of North America net sales

     5.1     4.8     4.4     3.9     3.5     N/A   

International Segment:

            

Net sales

   $ 5,737      $ 4,392      $ 4,507      $ 4,944      $ 7,529        31

Net sales — Y/Y growth, excluding F/X

     29     27     36     33     29     N/A   

Net sales — TTM

   $ 15,497      $ 16,539      $ 18,070      $ 19,580      $ 21,372        38

Net sales — TTM % of WW net sales

     45     45     45     45     44     N/A   

Operating income

   $ 327      $ 175      $ 172      $ 116      $ 177        (46 %) 

Operating margin — % of International net sales

     5.7     4.0     3.8     2.4     2.4     N/A   

Operating income — TTM

   $ 981      $ 922      $ 888      $ 790      $ 640        (35 %) 

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

     20     4     (7 %)      (23 %)      (41 %)      N/A   

Operating margin — TTM % of International net sales

     6.3     5.6     4.9     4.0     3.0     N/A   

Consolidated Segments:

            

Operating expenses (3)

   $ 12,326      $ 9,392      $ 9,527      $ 10,616      $ 16,969        38

Operating expenses — TTM (3)

   $ 32,268      $ 35,037      $ 38,404      $ 41,860      $ 46,504        44

Operating income

   $ 622      $ 465      $ 386      $ 260      $ 462        (26 %) 

Operating margin — % of Consolidated sales

     4.8     4.7     3.9     2.4     2.7     N/A   

Operating income — TTM

   $ 1,936      $ 1,894      $ 1,874      $ 1,734      $ 1,573        (19 %) 

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

     25     10     1     (11 %)      (21 %)      N/A   

Operating margin — TTM % of Consolidated net sales

     5.7     5.1     4.7     4.0     3.3     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 %
Change
 
     Q4 2010     Q1 2011     Q2 2011     Q3 2011     Q4 2011    

Supplemental

            

Supplemental North America Segment Net Sales:

            

Media

   $ 2,370      $ 1,885      $ 1,585      $ 1,927      $ 2,562        8

Media — Y/Y growth, excluding F/X

     13     18     19     21     8     N/A   

Media — TTM

   $ 6,881      $ 7,170      $ 7,430      $ 7,767      $ 7,959        16

Electronics and other general merchandise

   $ 4,558      $ 3,303      $ 3,496      $ 3,635      $ 6,881        51

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

     71     63     67     56     51     N/A   

Electronics and other general merchandise — TTM

   $ 10,998      $ 12,277      $ 13,683      $ 14,992      $ 17,315        57

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

     59     60     62     62     65     N/A   

Other

   $ 283      $ 277      $ 325      $ 370      $ 459        62

Other — TTM

   $ 828      $ 945      $ 1,095      $ 1,255      $ 1,431        73

Supplemental International Segment Net Sales:

            

Media

   $ 2,865      $ 2,073      $ 2,075      $ 2,226      $ 3,447        20

Media — Y/Y growth, excluding F/X

     13     9     20     17     18     N/A   

Media — TTM

   $ 8,007      $ 8,247      $ 8,772      $ 9,238      $ 9,820        23

Electronics and other general merchandise

   $ 2,834      $ 2,285      $ 2,398      $ 2,681      $ 4,032        42

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

     50     49     53     51     41     N/A   

Electronics and other general merchandise — TTM

   $ 7,365      $ 8,162      $ 9,162      $ 10,199      $ 11,397        55

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

     48     49     51     52     53     N/A   

Other

   $ 38      $ 34      $ 34      $ 37      $ 50        32

Other — TTM

   $ 125      $ 130      $ 136      $ 143      $ 155        24

Supplemental Worldwide Net Sales:

            

Media

   $ 5,235      $ 3,958      $ 3,660      $ 4,153      $ 6,009        15

Media — Y/Y growth, excluding F/X

     13     13     20     19     14     N/A   

Media — TTM

   $ 14,888      $ 15,417      $ 16,202      $ 17,005      $ 17,779        19

Electronics and other general merchandise

   $ 7,392      $ 5,588      $ 5,894      $ 6,316      $ 10,913        48

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

     62     57     62     54     47     N/A   

Electronics and other general merchandise — TTM

   $ 18,363      $ 20,439      $ 22,845      $ 25,191      $ 28,712        56

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

     54     55     57     58     60     N/A   

Other

   $ 321      $ 311      $ 359      $ 407      $ 509        58

Other — TTM

   $ 953      $ 1,075      $ 1,231      $ 1,398      $ 1,586        66

Balance Sheet

            

Cash and marketable securities

   $ 8,762      $ 6,881      $ 6,355      $ 6,326      $ 9,576        9

Inventory, net — ending

   $ 3,202      $ 2,888      $ 3,229      $ 3,770      $ 4,992        56

Inventory turnover, average — TTM

     11.4        11.6        11.3        10.8        10.3        (10 %) 

Fixed assets, net

   $ 2,414      $ 2,902      $ 3,470      $ 3,999      $ 4,417        83

Accounts payable — ending

   $ 8,051      $ 5,540      $ 5,721      $ 6,552      $ 11,145        38

Accounts payable days — ending

     72        66        69        72        74        3

Other

            

WW shipping revenue

   $ 437      $ 330      $ 331      $ 360      $ 531        21

WW shipping costs

   $ 999      $ 786      $ 820      $ 918      $ 1,466        47

WW net shipping costs

   $ 562      $ 456      $ 489      $ 558      $ 935        66

WW net shipping costs — % of WW net sales

     4.3     4.6     4.9     5.1     5.4     N/A   

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

     33,700        37,900        43,200        51,300        56,200        67

 

(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.endless.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
John Felton, 206/266-2171    Mary Osako, 206/266-7180
www.amazon.com/ir