SEATTLE--(BUSINESS WIRE)--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
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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
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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.
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AMAZON.COM, INC. Consolidated Statements of Cash Flows (in millions) (unaudited) |
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Three Months Ended September 30, |
Nine Months Ended September 30, |
Twelve Months Ended September 30, |
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| 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 | ||||||||||||||||
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Adjustments to reconcile net income (loss) to net cash from operating activities: |
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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: | ||||||||||||||||||||||||
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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 | ||||||||||||||||||
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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 | ||||||||||||||||||
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AMAZON.COM, INC. Consolidated Statements of Operations (in millions, except per share data) (unaudited) |
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Three Months Ended |
Nine Months Ended |
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| 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 | ||||||||||||
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(1) Represents revenue from the sale of products and related shipping fees and digital content where we are the seller of record. |
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(2) Represents third-party seller fees earned (including commissions) and related shipping fees, digital content subscriptions, and non-retail activities. |
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| (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 | ||||||||||||
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AMAZON.COM, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in millions) (unaudited) |
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 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 | ) | ||||||||||
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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 | |||||
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AMAZON.COM, INC. Segment Information (in millions) (unaudited) |
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 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 | % | |||||||||||||
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(1) Represents operating expenses, excluding stock-based compensation and "Other operating expense (income), net," which are not allocated to segments. |
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AMAZON.COM, INC. Supplemental Net Sales Information (in millions) (unaudited) |
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Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 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 | % | |||||||||
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(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. |
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|
AMAZON.COM, INC. Consolidated Balance Sheets (in millions, except per share data) |
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|
September 30, 2012 |
December 31, 2011 |
|||||||
| ASSETS | (unaudited) | |||||||
| 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) |
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| Q3 2011 | Q4 2011 | Q1 2012 | Q2 2012 | Q3 2012 |
Y/Y % Change |
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| 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) |
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| Q3 2011 | Q4 2011 | Q1 2012 | Q2 2012 | Q3 2012 |
Y/Y % Change |
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| 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. |
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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.