SEATTLE--(BUSINESS WIRE)--Feb. 1, 2018--
Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for
its fourth quarter ended December 31, 2017.
Operating cash flow increased 7% to $18.4 billion for the trailing
twelve months, compared with $17.3 billion for the trailing twelve
months ended December 31, 2016. Free cash flow decreased to $8.4 billion
for the trailing twelve months, compared with $10.5 billion for the
trailing twelve months ended December 31, 2016. Free cash flow less
lease principal repayments decreased to $3.4 billion for the trailing
twelve months, compared with $6.5 billion for the trailing twelve months
ended December 31, 2016. Free cash flow less finance lease principal
repayments and assets acquired under capital leases decreased to an
outflow of $1.5 billion for the trailing twelve months, compared with an
inflow of $4.7 billion for the trailing twelve months ended December 31,
2016.
Common shares outstanding plus shares underlying stock-based awards
totaled 504 million on December 31, 2017, compared with 497 million one
year ago.
Fourth Quarter 2017
Net sales increased 38% to $60.5 billion in the fourth quarter, compared
with $43.7 billion in fourth quarter 2016. Excluding the $1.1 billion
favorable impact from year-over-year changes in foreign exchange rates
throughout the quarter, net sales increased 36% compared with fourth
quarter 2016.
Operating income increased 69% to $2.1 billion in the fourth quarter,
compared with operating income of $1.3 billion in fourth quarter 2016.
Net income was $1.9 billion in the fourth quarter, or $3.75 per diluted
share, compared with net income of $749 million, or $1.54 per diluted
share, in fourth quarter 2016. The fourth quarter 2017 includes a
provisional tax benefit for the impact of the U.S. Tax Cuts and Jobs Act
of 2017 of approximately $789 million.
Full Year 2017
Net sales increased 31% to $177.9 billion, compared with $136.0 billion
in 2016. Excluding the $210 million favorable impact from year-over-year
changes in foreign exchange rates throughout the year, net sales
increased 31% compared with 2016.
Operating income decreased 2% to $4.1 billion, compared with operating
income of $4.2 billion in 2016.
Net income was $3.0 billion, or $6.15 per diluted share, compared with
net income of $2.4 billion, or $4.90 per diluted share, in 2016.
“Our 2017 projections for Alexa were very optimistic, and we far
exceeded them. We don’t see positive surprises of this magnitude very
often — expect us to double down,” said Jeff Bezos, Amazon founder and
CEO. “We’ve reached an important point where other companies and
developers are accelerating adoption of Alexa. There are now over 30,000
skills from outside developers, customers can control more than 4,000
smart home devices from 1,200 unique brands with Alexa, and we’re seeing
strong response to our new far-field voice kit for manufacturers. Much
more to come and a huge thank you to our customers and partners.”
Highlights
-
In 2017, more than five billion items shipped with Prime worldwide.
-
More new paid members joined Prime in 2017 than any previous year —
both worldwide and in the U.S.
-
Fire TV Stick and Echo Dot were the best-selling products in 2017
across all of Amazon. Customers purchased tens of millions of Echo
devices last year.
-
The Alexa Skills store now offers more than 30,000 skills, including
new developer tools for Alexa Gadgets and gaming experiences, such as
Activision’s new Ghost skill for console game Destiny 2. Other new
categories of skills include daily beauty podcasts from Hearst,
All-Star game voting from the NBA, and more. Customers can also now
use Alexa to control more than 4,000 smart home devices from 1,200
unique brands.
-
Amazon launched new ways for developers to earn money building for
Alexa, including paid skill content through in-skill purchasing,
premium subscription content, and a more frictionless checkout
experience with Amazon Pay. New skills offering premium paid content
include The Ellen DeGeneres Show’s popular Heads Up! game, The Match
Game, and the History Channel’s Ultimate History Quiz.
-
Alexa Voice Service (AVS) adoption among device makers continues to
grow. Brands announced new AVS products at the 2018 Consumer
Electronics Show, including: new integrations for Alexa on PCs from
HP, Acer, ASUS, and Lenovo; a new automotive integration with Toyota;
and new devices from Polk Audio, Anker, Jabra, and more.
-
Amazon also introduced new tools and developer kits, including the
Alexa Mobile Accessory Kit and Alexa Premium Far-Field Voice
Development Kit, to make it easier for developers to bring Alexa to
more devices.
-
Amazon hired nearly 130,000 employees globally in 2017, excluding
acquisitions. Additionally, Amazon now employs more than 17,500
veterans and military spouses across the U.S., and plans to hire over
10,000 more by 2021.
-
Amazon welcomed several new device makers to the Dash Replenishment
program to enable their smart appliances to automatically reorder
consumables when supply runs low, including 3M, Hewlett-Packard,
Kenmore, and Bluestream.
-
Amazon celebrated the 10th anniversary of Kindle by
releasing the all-new Kindle Oasis, the most advanced Kindle with a
7-inch, 300 ppi display, waterproof design, and access to the world’s
largest library of audiobooks with Audible support. Since the Kindle
launch in November 2007, customers have purchased tens of millions of
Kindle e-readers.
-
Amazon announced that the Prime Video app is now available on Apple TV
in over 100 countries. Prime members now have more ways to stream
award-winning and critically-acclaimed titles, including Amazon
Original Movies and Prime Originals.
-
Amazon Studios’ Original movie The Big Sick was nominated for
an Academy Award for Best Original Screenplay, written by Emily V.
Gordon and Kumail Nanjiani.
-
The Amazon Original Series The Marvelous Mrs. Maisel won two
Golden Globes for “Best Television Series - Musical or Comedy” and
“Best Actress - Musical or Comedy” (Rachel Brosnahan), as well as two
Critics Choice awards for “Best Comedy Series” and “Best Actress in a
Comedy Series” (Rachel Brosnahan).
-
Amazon Studios debuted the highly-anticipated second season of The
Grand Tour. Additionally, Prime members can look forward to new
and returning series this year such as Goliath season two, Sneaky
Pete season two, The Man in the High Castle season three, Bosch
season four, Mozart in the Jungle season four, and new episodes
from The Tick, Tom Clancy’s Jack Ryan, and The
Romanoffs.
-
NFL Thursday Night Football on Amazon Prime Video saw a total of 18.4
million views in 11 games. Prime members in more than 200 countries
and territories streamed games on living room devices, including smart
TVs and Fire TVs, as well as the Prime Video mobile app and the web.
-
CBS All Access is now available through Amazon Channels, the
over-the-top streaming subscription program for Prime members. CBS is
the first Amazon Channels partner to offer a linear feed of a
subscriber’s local broadcast station in addition to video on-demand.
-
Amazon acquired the global television rights to The Lord of the
Rings, based on the novels by J.R.R. Tolkien, with a multi-season
commitment.
-
Amazon Prime Video continues to launch local Original Series,
including Breathe in India, as well as Pastewka and Glory
is Gone in Germany.
-
Amazon introduced all-new Alexa experiences built from the ground up
for customers in Japan, India, Canada, Australia, and New Zealand.
Additionally, Amazon expanded Alexa, Echo, and Amazon Music Unlimited
to 30 new countries, offering customers access to tens of millions of
songs, thousands of hand-curated playlists and stations, and enabling
customers who purchase Echo devices the ability to experience Amazon
Music Unlimited with natural voice controls powered by Alexa.
-
Amazon launched two furniture brands: Rivet, offering affordable and
versatile mid-century modern furniture ideal for smaller spaces; and
Stone & Beam, offering durable and stylish furniture for the modern
household.
-
Amazon Go, a new kind of store with no checkout required, is now open
to the public in Seattle. The checkout-free shopping experience is
made possible by the same types of technologies used in self-driving
cars: computer vision, machine learning, and sensor fusion.
-
Fulfillment by Amazon (FBA) shipped billions of items for small and
medium-sized businesses, selling on Amazon worldwide in 2017.
-
Amazon launched its retail and third-party marketplace offering in
Australia with fast delivery on millions of products, including items
from thousands of small and medium-sized businesses.
-
Amazon launched Prime in the Netherlands and Luxembourg, and added the
ability for customers in Belgium to join Prime and shop in Dutch.
These programs offer members access to unlimited free one-day and
two-day delivery, unlimited streaming of Prime Video, Twitch Prime,
and early access to Prime Lightning Deals — all for an introductory
price of €3.99 per month.
-
Amazon launched Prime in Singapore, offering members access to
unlimited free shipping on millions of local and international items,
unlimited access to popular movies and TV shows on Prime Video, and
video game benefits with Twitch — all for an introductory price of
S$2.99 per month.
-
Prime selection in India now offers members more than 25 million local
products from third-party sellers.
-
Amazon.com.br continues to expand its third-party marketplace,
including the launch of Consumer Electronics, Home & Kitchen, Tools &
Home Improvement, and Office Products. Customers in Brazil now have
access to hundreds of thousands of products as well as more than 13
million print and digital books.
-
Amazon celebrated its 10th holiday season of
Frustration-Free Packaging — an invention designed to reduce waste and
delight customers with easy-to-open, 100% recyclable packaging. As of
the end of 2017, Amazon’s sustainable packaging innovations have
helped to eliminate nearly 215,000 tons of packaging material and 360
million boxes.
-
Amazon, Berkshire Hathaway, and JPMorgan Chase & Co. announced a
partnership to address healthcare for their U.S. employees, with the
aim of improving employee satisfaction and reducing costs.
-
In December, Amazon’s “Delivering Smiles” holiday tour stopped in over
30 communities where Amazon employees live and work, donating
thousands of items to women, children, and families fighting
homelessness. For each mile traveled along the delivery route, Amazon
donated $1 to the National Alliance to End Homelessness.
-
Amazon reviewed 238 proposals from across the U.S., Canada, and Mexico
to host HQ2, the company’s second headquarters in North America, and
selected 20 metropolitan areas to move to the next phase of the
process. Amazon expects to invest over $5 billion and create as many
as 50,000 high-paying jobs at its new second home.
-
Amazon Web Services (AWS) announced several enterprise customers
during the quarter: Expedia, Ellucian, and DigitalGlobe are going
all-in on AWS; The Walt Disney Company and Turner named AWS their
preferred public cloud provider; Symantec will leverage AWS as its
strategic infrastructure provider for the vast majority of its cloud
workloads; Expedia, Intuit, the National Football League (NFL),
Capital One, DigitalGlobe, and Cerner announced they’ve chosen AWS for
machine learning and artificial intelligence; and Bristol-Myers
Squibb, Honeywell, Experian, FICO, Insitu, LexisNexis, Sysco,
Discovery Communications, Dow Jones, and Ubisoft kicked off major new
moves to AWS.
-
AWS continued to expand its infrastructure in 2017 to best serve
customers, launching a new region in France and a second AWS Region in
China during the quarter. AWS plans to open 12 more Availability Zones
across four regions (Bahrain, Hong Kong, Sweden, and a second GovCloud
Region in the U.S.) between now and early 2019. AWS now operates 52
Availability Zones across 18 infrastructure regions globally.
-
AWS continues to accelerate its pace of innovation with the release of
497 significant new services and features in the fourth quarter,
bringing the total number of launches in 2017 to 1,430.
-
AWS announced Amazon SageMaker, a fully managed service that removes
the heavy lifting, complexity, and guesswork from each step of the
machine learning process, empowering everyday developers and
scientists to use machine learning much more expansively and
successfully. Amazon SageMaker makes model building and training
easier by providing prebuilt development notebooks, popular machine
learning algorithms optimized for petabyte-scale datasets, and
automatic model tuning, enabling developers to build, train, and
deploy models in a single click. Since its launch two months ago,
Amazon SageMaker is already helping thousands of developers to easily
get started and become competent in building, training, and deploying
models.
-
AWS launched EC2 P3 instances which are optimized for machine learning
and high performance computing — providing up to six times better
performance than any other GPU instances available in the cloud today.
P3 instances significantly reduce the time it takes to train machine
learning models, providing a substantial boost in agility for
developers experimenting and optimizing machine learning applications.
The combination of EC2 P3 instances and Amazon SageMaker provide
developers and data scientists access to the industry’s most powerful
and easy-to-use solution for building machine learning applications.
-
AWS introduced four Artificial Intelligence (AI) services that allow
developers to build applications that emulate human-like cognition:
Amazon Transcribe for converting speech to text; Amazon Translate for
translating text between languages; Amazon Comprehend for
understanding relationships and finding insights within text; and
Amazon Rekognition Video, a deep-learning powered video analysis
service that tracks people, detects activities, and recognizes
objects, celebrities, and inappropriate content.
-
AWS launched AWS DeepLens, a deep-learning enabled wireless video
camera that pairs an HD camera developer kit with a set of sample
projects to help developers learn machine learning concepts, including
computer vision and deep learning.
-
AWS introduced several services and capabilities for connected devices
at the edge: AWS IoT 1-Click makes it easy for simple devices to
trigger AWS Lambda functions that execute a specific action; AWS IoT
Device Management helps to securely onboard, organize, monitor, and
remotely manage customers’ IoT devices at scale throughout their
lifecycle; AWS IoT Device Defender allows customers to secure their
fleet of IoT devices on an ongoing basis; AWS IoT Analytics enables
customers to cleanse, process, enrich, store, and analyze IoT device
data at scale; Amazon FreeRTOS is an IoT operating system for
microcontrollers that makes small, low-powered edge devices easy to
program, deploy, secure, connect, and maintain; and AWS Greengrass
Machine Learning (ML) Inference makes it easy to perform ML inference
locally on AWS Greengrass devices even when they are not connected to
the cloud.
-
In its second year of availability, the number of databases migrated
to AWS in 2017 using the AWS Database Migration Service is
accelerating — growing more than 100% over 2016 to a total of more
than 54,000 databases migrated since the introduction of the service.
-
AWS launched the Amazon ML Solutions Lab, a program that connects
machine learning experts from across Amazon with AWS customers to help
identify practical uses of machine learning inside customers’
businesses, and guide them in developing new machine learning-enabled
features, products, and processes. The Amazon ML Solutions Lab
combines hands-on educational workshops with brainstorming sessions to
help customers “work backwards” from business challenges, and
understand the step-by-step processes for developing machine
learning-based solutions.
-
AWS introduced several new database capabilities: Amazon Aurora
Serverless is an on-demand auto-scaling configuration for Amazon
Aurora that saves customers time and money by automatically adjusting
database capacity to match application needs; Amazon DynamoDB with
Global Tables is the first fully managed database service that
provides true multi-master, multi-region read and writes, offering
high-performance and low-latency for globally distributed applications
and users; and Amazon Neptune is a fast, reliable, fully managed graph
database service that makes it easy for developers to build and run
applications that work with highly connected datasets.
-
AWS announced two new container capabilities that make it easier to
deploy, manage, and scale container workloads on AWS. Amazon Elastic
Container Service for Kubernetes (Amazon EKS) brings Kubernetes to AWS
as a fully managed service, enabling customers to run Kubernetes
applications on AWS without the need to become experts in operating
Kubernetes clusters. AWS also introduced AWS Fargate that allows
customers to launch and run containers without provisioning or
managing servers or clusters.
-
AWS launched three new Amazon EC2 instances: the I3 High I/O family
introduces a brand new capability with Amazon EC2 Bare Metal instances
that enable customers to run workloads directly on AWS hardware, or
bring their own hypervisor or virtualization stack; H1 is a new family
of Storage Optimized instances designed for applications that require
low cost, high disk throughput and high sequential disk I/O access to
very large data sets; and M5, the next generation of General Purpose
instances, provides higher performance and lower prices for general
purpose workloads, delivering even better compute, memory, and
networking performance, powered by the latest 2.5 GHz Intel Xeon
Platinum 8000 series processors.
-
AWS announced Amazon GuardDuty, a fully managed intelligent threat
detection service that helps customers protect their AWS accounts and
workloads by continuously monitoring and analyzing account activity
for malicious or unauthorized behavior. Amazon GuardDuty applies
machine learning to identify anomalies and alert customers.
-
AWS introduced the preview of Amazon S3 Select, which lets customers
pull out only the data they need from an S3 object instead of
retrieving the entire object, dramatically improving the performance
and reducing the cost of applications that need to access data in
Amazon S3. AWS also announced Amazon Glacier Select, which allows
companies in highly regulated industries to easily query cold,
archived data in Amazon Glacier, and unlock new business value for
archived data.
-
AWS launched Amazon Sumerian, a new service that makes it easy for any
developer to quickly and easily build virtual reality, augmented
reality, and 3D applications to run on mobile devices, head-mounted
displays, digital signage, or web browsers. Apps created in Amazon
Sumerian will run in any browser that supports WebGL or WebVR graphics
rendering, including Daydream, HTC Vive, Oculus Rift, and iOS mobile
devices.
-
AWS announced AWS Media Services, a family of five integrated
broadcast-quality media services that make it easy for video providers
of all kinds to create reliable, flexible, and scalable video
offerings in the cloud. These five services enable customers to build
end-to-end workflows for both live and on-demand video with the
professional features, image quality, and reliability needed to
deliver premium video experiences to viewers across a multitude of
devices. By combining the proven video solutions from AWS Elemental
with the security, durability, availability, and scalability of AWS,
video providers can focus on innovating and making great content
instead of spending time building and maintaining on-premises video
infrastructure.
-
AWS launched Alexa for Business, a new service that brings Alexa into
the workplace to help employees be more productive and organized on
both personal and shared Echo devices by simply using their voice.
Employees can use Alexa for Business to find an open conference room,
make phone calls, check calendars, schedule and start meetings, manage
to-do lists, set reminders, and even find information in popular
business applications like Salesforce, Concur, or Splunk.
-
At re:Invent, AWS and VMware Inc. announced that VMware Cloud on AWS
is expanding availability from the U.S. West (Oregon) region to
include the AWS U.S. East (N. Virginia) region. AWS also announced
additional VMware capabilities and support for more AWS services,
making it even easier for customers to move, run, and protect
mission-critical applications at scale.
Financial Guidance
The following forward-looking statements reflect Amazon.com’s
expectations as of February 1, 2018, and are subject to substantial
uncertainty. 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 customer
spending, world events, the rate of growth of the Internet, online
commerce, and cloud services, and the various factors detailed below.
First Quarter 2018 Guidance
-
Net sales are expected to be between $47.75 billion and $50.75
billion, or to grow between 34% and 42% compared with first quarter
2017. This guidance anticipates a favorable impact of approximately
$1.2 billion or 330 basis points from foreign exchange rates.
-
Operating income is expected to be between $300 million and $1.0
billion, compared with $1.0 billion in first quarter 2017.
-
This guidance assumes, among other things, that no additional business
acquisitions, investments, restructurings, or legal settlements are
concluded.
A conference call will be webcast live today at 2:30 p.m. PT/5:30 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 and services sold to customers, the mix
of net sales derived from products as compared with services, the extent
to which we owe income or other taxes, competition, management of
growth, potential fluctuations in operating results, international
growth and expansion, the outcomes of legal proceedings and claims,
fulfillment, sortation, delivery, and data center optimization, risks of
inventory management, seasonality, the degree to which the Company
enters into, maintains, and develops commercial agreements, proposed and
completed acquisitions and strategic transactions, payments risks, 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, 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, which may contain material
information about us, and you may subscribe to be notified of new
information posted to this site.
About Amazon
Amazon is guided by four principles: customer obsession rather than
competitor focus, passion for invention, commitment to operational
excellence, and long-term thinking. Customer reviews, 1-Click shopping,
personalized recommendations, Prime, Fulfillment by Amazon, AWS, Kindle
Direct Publishing, Kindle, Fire tablets, Fire TV, Amazon Echo, and Alexa
are some of the products and services pioneered by Amazon. For more
information, visit www.amazon.com/about and follow @AmazonNews.
|
AMAZON.COM, INC.
|
Consolidated Statements of Cash Flows
|
(in millions)
|
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
|
(unaudited)
|
|
|
|
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
|
$
|
13,656
|
|
|
$
|
12,767
|
|
|
$
|
15,890
|
|
|
$
|
19,334
|
|
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net income
|
|
749
|
|
|
1,856
|
|
|
2,371
|
|
|
3,033
|
|
Adjustments to reconcile net income to net cash from operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation of property and equipment, including internal-use
software and website development, and other amortization, including
capitalized content costs
|
|
2,297
|
|
|
3,498
|
|
|
8,116
|
|
|
11,478
|
|
Stock-based compensation
|
|
887
|
|
|
1,179
|
|
|
2,975
|
|
|
4,215
|
|
Other operating expense, net
|
|
31
|
|
|
56
|
|
|
160
|
|
|
202
|
|
Other expense (income), net
|
|
21
|
|
|
(5
|
)
|
|
(20
|
)
|
|
(292
|
)
|
Deferred income taxes
|
|
(282
|
)
|
|
(308
|
)
|
|
(246
|
)
|
|
(29
|
)
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Inventories
|
|
(1,043
|
)
|
|
(2,255
|
)
|
|
(1,426
|
)
|
|
(3,583
|
)
|
Accounts receivable, net and other
|
|
(1,924
|
)
|
|
(2,781
|
)
|
|
(3,367
|
)
|
|
(4,786
|
)
|
Accounts payable
|
|
7,283
|
|
|
8,907
|
|
|
5,030
|
|
|
7,175
|
|
Accrued expenses and other
|
|
2,254
|
|
|
2,061
|
|
|
1,724
|
|
|
283
|
|
Unearned revenue
|
|
714
|
|
|
136
|
|
|
1,955
|
|
|
738
|
|
Net cash provided by (used in) operating activities (1)
|
|
10,987
|
|
|
12,344
|
|
|
17,272
|
|
|
18,434
|
|
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Purchases of property and equipment, including internal-use software
and website development
|
|
(2,414
|
)
|
|
(3,619
|
)
|
|
(7,804
|
)
|
|
(11,955
|
)
|
Proceeds from property and equipment incentives
|
|
409
|
|
|
583
|
|
|
1,067
|
|
|
1,897
|
|
Acquisitions, net of cash acquired, and other
|
|
(3
|
)
|
|
(81
|
)
|
|
(116
|
)
|
|
(13,972
|
)
|
Sales and maturities of marketable securities
|
|
1,233
|
|
|
3,564
|
|
|
4,733
|
|
|
9,988
|
|
Purchases of marketable securities
|
|
(3,399
|
)
|
|
(2,479
|
)
|
|
(7,756
|
)
|
|
(13,777
|
)
|
Net cash provided by (used in) investing activities
|
|
(4,174
|
)
|
|
(2,032
|
)
|
|
(9,876
|
)
|
|
(27,819
|
)
|
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Proceeds from long-term debt and other
|
|
537
|
|
|
61
|
|
|
621
|
|
|
16,231
|
|
Repayments of long-term debt and other
|
|
(84
|
)
|
|
(1,170
|
)
|
|
(354
|
)
|
|
(1,372
|
)
|
Principal repayments of capital lease obligations
|
|
(1,004
|
)
|
|
(1,472
|
)
|
|
(3,860
|
)
|
|
(4,799
|
)
|
Principal repayments of finance lease obligations
|
|
(41
|
)
|
|
(66
|
)
|
|
(147
|
)
|
|
(200
|
)
|
Net cash provided by (used in) financing activities (1)
|
|
(592
|
)
|
|
(2,647
|
)
|
|
(3,740
|
)
|
|
9,860
|
|
Foreign currency effect on cash and cash equivalents
|
|
(543
|
)
|
|
90
|
|
|
(212
|
)
|
|
713
|
|
Net increase (decrease) in cash and cash equivalents
|
|
5,678
|
|
|
7,755
|
|
|
3,444
|
|
|
1,188
|
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
|
$
|
19,334
|
|
|
$
|
20,522
|
|
|
$
|
19,334
|
|
|
$
|
20,522
|
|
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
Cash paid for interest on long-term debt
|
|
$
|
144
|
|
|
$
|
174
|
|
|
$
|
290
|
|
|
$
|
328
|
|
Cash paid for interest on capital and finance lease obligations
|
|
61
|
|
|
84
|
|
|
206
|
|
|
319
|
|
Cash paid for income taxes, net of refunds
|
|
95
|
|
|
92
|
|
|
412
|
|
|
957
|
|
Property and equipment acquired under capital leases
|
|
2,038
|
|
|
2,770
|
|
|
5,704
|
|
|
9,637
|
|
Property and equipment acquired under build-to-suit leases
|
|
416
|
|
|
843
|
|
|
1,209
|
|
|
3,541
|
|
______________________________
|
(1)
|
|
As a result of accounting guidance adopted in Q1 2017, we
retrospectively adjusted our consolidated statements of cash flows
to reclassify excess tax benefits of $336 million for the
three-months ended December 31, 2016 and $829 million for the
twelve-months ended December 31, 2016 from financing activities to
operating activities.
|
|
AMAZON.COM, INC.
|
Consolidated Statements of Operations
|
(in millions, except per share data)
|
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
|
(unaudited)
|
|
|
|
|
Net product sales
|
|
$
|
30,629
|
|
|
$
|
41,325
|
|
|
$
|
94,665
|
|
|
$
|
118,573
|
|
Net service sales
|
|
13,112
|
|
|
19,128
|
|
|
41,322
|
|
|
59,293
|
|
Total net sales
|
|
43,741
|
|
|
60,453
|
|
|
135,987
|
|
|
177,866
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
28,958
|
|
|
38,494
|
|
|
88,265
|
|
|
111,934
|
|
Fulfillment
|
|
5,719
|
|
|
8,974
|
|
|
17,619
|
|
|
25,249
|
|
Marketing
|
|
2,513
|
|
|
3,440
|
|
|
7,233
|
|
|
10,069
|
|
Technology and content
|
|
4,545
|
|
|
6,314
|
|
|
16,085
|
|
|
22,620
|
|
General and administrative
|
|
717
|
|
|
1,044
|
|
|
2,432
|
|
|
3,674
|
|
Other operating expense, net
|
|
34
|
|
|
60
|
|
|
167
|
|
|
214
|
|
Total operating expenses
|
|
42,486
|
|
|
58,326
|
|
|
131,801
|
|
|
173,760
|
|
Operating income
|
|
1,255
|
|
|
2,127
|
|
|
4,186
|
|
|
4,106
|
|
Interest income
|
|
30
|
|
|
66
|
|
|
100
|
|
|
202
|
|
Interest expense
|
|
(133
|
)
|
|
(339
|
)
|
|
(484
|
)
|
|
(848
|
)
|
Other income (expense), net
|
|
14
|
|
|
18
|
|
|
90
|
|
|
346
|
|
Total non-operating income (expense)
|
|
(89
|
)
|
|
(255
|
)
|
|
(294
|
)
|
|
(300
|
)
|
Income before income taxes
|
|
1,166
|
|
|
1,872
|
|
|
3,892
|
|
|
3,806
|
|
Provision for income taxes
|
|
(414
|
)
|
|
(16
|
)
|
|
(1,425
|
)
|
|
(769
|
)
|
Equity-method investment activity, net of tax
|
|
(3
|
)
|
|
—
|
|
|
(96
|
)
|
|
(4
|
)
|
Net income
|
|
$
|
749
|
|
|
$
|
1,856
|
|
|
$
|
2,371
|
|
|
$
|
3,033
|
|
Basic earnings per share
|
|
$
|
1.57
|
|
|
$
|
3.85
|
|
|
$
|
5.01
|
|
|
$
|
6.32
|
|
Diluted earnings per share
|
|
$
|
1.54
|
|
|
$
|
3.75
|
|
|
$
|
4.90
|
|
|
$
|
6.15
|
|
Weighted-average shares used in computation of earnings per share:
|
|
|
|
|
|
|
|
|
Basic
|
|
476
|
|
|
483
|
|
|
474
|
|
|
480
|
|
Diluted
|
|
486
|
|
|
496
|
|
|
484
|
|
|
493
|
|
|
AMAZON.COM, INC.
|
Consolidated Statements of Comprehensive Income
|
(in millions)
|
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
|
(unaudited)
|
|
|
|
|
Net income
|
|
$
|
749
|
|
|
$
|
1,856
|
|
|
$
|
2,371
|
|
|
$
|
3,033
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustments, net of tax of $(68), $10,
$(49), and $5
|
|
(412
|
)
|
|
47
|
|
|
(279
|
)
|
|
533
|
|
Net change in unrealized gains (losses) on available-for-sale
securities:
|
|
|
|
|
|
|
|
|
Unrealized gains (losses), net of tax of $22, $4, $(12), and $5
|
|
(54
|
)
|
|
(29
|
)
|
|
9
|
|
|
(39
|
)
|
Reclassification adjustment for losses (gains) included in “Other
income (expense), net,” net of tax of $0, $0, $0, and $0
|
|
3
|
|
|
(1
|
)
|
|
8
|
|
|
7
|
|
Net unrealized gains (losses) on available-for-sale securities
|
|
(51
|
)
|
|
(30
|
)
|
|
17
|
|
|
(32
|
)
|
Total other comprehensive income (loss)
|
|
(463
|
)
|
|
17
|
|
|
(262
|
)
|
|
501
|
|
Comprehensive income
|
|
$
|
286
|
|
|
$
|
1,873
|
|
|
$
|
2,109
|
|
|
$
|
3,534
|
|
|
AMAZON.COM, INC.
|
Segment Information
|
(in millions)
|
|
|
|
Three Months Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
|
(unaudited)
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
26,240
|
|
|
$
|
37,302
|
|
|
$
|
79,785
|
|
|
$
|
106,110
|
|
Operating expenses
|
|
25,424
|
|
|
35,610
|
|
|
77,424
|
|
|
103,273
|
|
Operating income
|
|
$
|
816
|
|
|
$
|
1,692
|
|
|
$
|
2,361
|
|
|
$
|
2,837
|
|
|
|
|
|
|
|
|
|
|
International
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
13,965
|
|
|
$
|
18,038
|
|
|
$
|
43,983
|
|
|
$
|
54,297
|
|
Operating expenses
|
|
14,452
|
|
|
18,957
|
|
|
45,266
|
|
|
57,359
|
|
Operating income (loss)
|
|
$
|
(487
|
)
|
|
$
|
(919
|
)
|
|
$
|
(1,283
|
)
|
|
$
|
(3,062
|
)
|
|
|
|
|
|
|
|
|
|
AWS
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
3,536
|
|
|
$
|
5,113
|
|
|
$
|
12,219
|
|
|
$
|
17,459
|
|
Operating expenses
|
|
2,610
|
|
|
3,759
|
|
|
9,111
|
|
|
13,128
|
|
Operating income
|
|
$
|
926
|
|
|
$
|
1,354
|
|
|
$
|
3,108
|
|
|
$
|
4,331
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
43,741
|
|
|
$
|
60,453
|
|
|
$
|
135,987
|
|
|
$
|
177,866
|
|
Operating expenses
|
|
42,486
|
|
|
58,326
|
|
|
131,801
|
|
|
173,760
|
|
Operating income
|
|
1,255
|
|
|
2,127
|
|
|
4,186
|
|
|
4,106
|
|
Total non-operating income (expense)
|
|
(89
|
)
|
|
(255
|
)
|
|
(294
|
)
|
|
(300
|
)
|
Provision for income taxes
|
|
(414
|
)
|
|
(16
|
)
|
|
(1,425
|
)
|
|
(769
|
)
|
Equity-method investment activity, net of tax
|
|
(3
|
)
|
|
—
|
|
|
(96
|
)
|
|
(4
|
)
|
Net income
|
|
$
|
749
|
|
|
$
|
1,856
|
|
|
$
|
2,371
|
|
|
$
|
3,033
|
|
|
|
|
|
|
|
|
|
|
Segment Highlights:
|
|
|
|
|
|
|
|
|
Y/Y net sales growth:
|
|
|
|
|
|
|
|
|
North America
|
|
22
|
%
|
|
42
|
%
|
|
25
|
%
|
|
33
|
%
|
International
|
|
18
|
|
|
29
|
|
|
24
|
|
|
23
|
|
AWS
|
|
47
|
|
|
45
|
|
|
55
|
|
|
43
|
|
Consolidated
|
|
22
|
|
|
38
|
|
|
27
|
|
|
31
|
|
Net sales mix:
|
|
|
|
|
|
|
|
|
North America
|
|
60
|
%
|
|
62
|
%
|
|
59
|
%
|
|
60
|
%
|
International
|
|
32
|
|
|
30
|
|
|
32
|
|
|
30
|
|
AWS
|
|
8
|
|
|
8
|
|
|
9
|
|
|
10
|
|
Consolidated
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
AMAZON.COM, INC.
|
Consolidated Balance Sheets
|
(in millions, except per share data)
|
|
|
|
December 31, 2016
|
|
December 31, 2017
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
19,334
|
|
|
$
|
20,522
|
|
Marketable securities
|
|
6,647
|
|
|
10,464
|
|
Inventories
|
|
11,461
|
|
|
16,047
|
|
Accounts receivable, net and other
|
|
8,339
|
|
|
13,164
|
|
Total current assets
|
|
45,781
|
|
|
60,197
|
|
Property and equipment, net
|
|
29,114
|
|
|
48,866
|
|
Goodwill
|
|
3,784
|
|
|
13,350
|
|
Other assets
|
|
4,723
|
|
|
8,897
|
|
Total assets
|
|
$
|
83,402
|
|
|
$
|
131,310
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable
|
|
$
|
25,309
|
|
|
$
|
34,616
|
|
Accrued expenses and other
|
|
13,739
|
|
|
18,170
|
|
Unearned revenue
|
|
4,768
|
|
|
5,097
|
|
Total current liabilities
|
|
43,816
|
|
|
57,883
|
|
Long-term debt
|
|
7,694
|
|
|
24,743
|
|
Other long-term liabilities
|
|
12,607
|
|
|
20,975
|
|
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 — 500 and 507
|
|
|
|
|
Outstanding shares — 477 and 484
|
|
5
|
|
|
5
|
|
Treasury stock, at cost
|
|
(1,837
|
)
|
|
(1,837
|
)
|
Additional paid-in capital
|
|
17,186
|
|
|
21,389
|
|
Accumulated other comprehensive loss
|
|
(985
|
)
|
|
(484
|
)
|
Retained earnings
|
|
4,916
|
|
|
8,636
|
|
Total stockholders’ equity
|
|
19,285
|
|
|
27,709
|
|
Total liabilities and stockholders’ equity
|
|
$
|
83,402
|
|
|
$
|
131,310
|
|
|
AMAZON.COM, INC.
|
Supplemental Financial Information and Business Metrics
|
(in millions, except per share data)
|
(unaudited)
|
|
|
|
Q3 2016
|
|
Q4 2016
|
|
Q1 2017
|
|
Q2 2017
|
|
Q3 2017
|
|
Q4 2017
|
|
Y/Y %
Change
|
Cash Flows and Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating cash flow — trailing twelve months (TTM) (1)
|
|
$
|
15,004
|
|
|
$
|
17,272
|
|
|
$
|
17,634
|
|
|
$
|
17,885
|
|
|
$
|
17,077
|
|
|
$
|
18,434
|
|
|
7
|
%
|
Operating cash flow — TTM Y/Y growth
|
|
51
|
%
|
|
43
|
%
|
|
53
|
%
|
|
37
|
%
|
|
14
|
%
|
|
7
|
%
|
|
N/A
|
Purchases of property and equipment, including internal-use
software and website development, net of proceeds from property
and equipment incentives — TTM
|
|
$
|
6,040
|
|
|
$
|
6,737
|
|
|
$
|
7,417
|
|
|
$
|
8,207
|
|
|
$
|
9,027
|
|
|
$
|
10,058
|
|
|
49
|
%
|
Principal repayments of capital lease obligations — TTM
|
|
$
|
3,579
|
|
|
$
|
3,860
|
|
|
$
|
3,891
|
|
|
$
|
4,003
|
|
|
$
|
4,331
|
|
|
$
|
4,799
|
|
|
24
|
%
|
Principal repayments of finance lease obligations — TTM
|
|
$
|
131
|
|
|
$
|
147
|
|
|
$
|
155
|
|
|
$
|
170
|
|
|
$
|
175
|
|
|
$
|
200
|
|
|
36
|
%
|
Property and equipment acquired under capital leases — TTM
|
|
$
|
4,998
|
|
|
$
|
5,704
|
|
|
$
|
6,717
|
|
|
$
|
8,019
|
|
|
$
|
8,905
|
|
|
$
|
9,637
|
|
|
69
|
%
|
Free cash flow — TTM (1) (2)
|
|
$
|
8,964
|
|
|
$
|
10,535
|
|
|
$
|
10,217
|
|
|
$
|
9,678
|
|
|
$
|
8,050
|
|
|
$
|
8,376
|
|
|
(20
|
)%
|
Free cash flow less lease principal repayments — TTM (1) (3)
|
|
$
|
5,254
|
|
|
$
|
6,528
|
|
|
$
|
6,171
|
|
|
$
|
5,505
|
|
|
$
|
3,544
|
|
|
$
|
3,377
|
|
|
(48
|
)%
|
Free cash flow less finance lease principal repayments and assets
acquired under capital leases — TTM (1) (4)
|
|
$
|
3,835
|
|
|
$
|
4,684
|
|
|
$
|
3,345
|
|
|
$
|
1,489
|
|
|
$
|
(1,030
|
)
|
|
$
|
(1,461
|
)
|
|
(131
|
)%
|
Invested capital (5)
|
|
$
|
36,722
|
|
|
$
|
39,126
|
|
|
$
|
42,114
|
|
|
$
|
45,537
|
|
|
$
|
52,690
|
|
|
$
|
60,368
|
|
|
54
|
%
|
Common shares and stock-based awards outstanding
|
|
496
|
|
|
497
|
|
|
497
|
|
|
502
|
|
|
503
|
|
|
504
|
|
|
1
|
%
|
Common shares outstanding
|
|
475
|
|
|
477
|
|
|
478
|
|
|
480
|
|
|
482
|
|
|
484
|
|
|
1
|
%
|
Stock-based awards outstanding
|
|
21
|
|
|
20
|
|
|
20
|
|
|
22
|
|
|
21
|
|
|
20
|
|
|
1
|
%
|
Stock-based awards outstanding — % of common shares outstanding
|
|
4.4
|
%
|
|
4.2
|
%
|
|
4.1
|
%
|
|
4.5
|
%
|
|
4.4
|
%
|
|
4.2
|
%
|
|
N/A
|
Results of Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide (WW) net sales
|
|
$
|
32,714
|
|
|
$
|
43,741
|
|
|
$
|
35,714
|
|
|
$
|
37,955
|
|
|
$
|
43,744
|
|
|
$
|
60,453
|
|
|
38
|
%
|
WW net sales — Y/Y growth, excluding F/X
|
|
29
|
%
|
|
24
|
%
|
|
24
|
%
|
|
26
|
%
|
|
33
|
%
|
|
36
|
%
|
|
N/A
|
WW net sales — TTM
|
|
$
|
127,993
|
|
|
$
|
135,987
|
|
|
$
|
142,572
|
|
|
$
|
150,123
|
|
|
$
|
161,154
|
|
|
$
|
177,866
|
|
|
31
|
%
|
WW net sales — TTM Y/Y growth, excluding F/X
|
|
28
|
%
|
|
28
|
%
|
|
26
|
%
|
|
26
|
%
|
|
27
|
%
|
|
31
|
%
|
|
N/A
|
Operating income
|
|
$
|
575
|
|
|
$
|
1,255
|
|
|
$
|
1,005
|
|
|
$
|
628
|
|
|
$
|
347
|
|
|
$
|
2,127
|
|
|
69
|
%
|
FX impact — favorable (unfavorable)
|
|
$
|
8
|
|
|
$
|
7
|
|
|
$
|
(31
|
)
|
|
$
|
(38
|
)
|
|
$
|
(39
|
)
|
|
$
|
(33
|
)
|
|
N/A
|
Operating income — Y/Y growth (decline), excluding F/X
|
|
40
|
%
|
|
13
|
%
|
|
(3
|
)%
|
|
(48
|
)%
|
|
(33
|
)%
|
|
72
|
%
|
|
N/A
|
Operating margin — % of WW net sales
|
|
1.8
|
%
|
|
2.9
|
%
|
|
2.8
|
%
|
|
1.7
|
%
|
|
0.8
|
%
|
|
3.5
|
%
|
|
N/A
|
Operating income — TTM
|
|
$
|
4,040
|
|
|
$
|
4,186
|
|
|
$
|
4,120
|
|
|
$
|
3,462
|
|
|
$
|
3,234
|
|
|
$
|
4,106
|
|
|
(2
|
)%
|
Operating income — TTM Y/Y growth (decline), excluding F/X
|
|
128
|
%
|
|
83
|
%
|
|
34
|
%
|
|
(9
|
)%
|
|
(17
|
)%
|
|
1
|
%
|
|
N/A
|
Operating margin — TTM % of WW net sales
|
|
3.2
|
%
|
|
3.1
|
%
|
|
2.9
|
%
|
|
2.3
|
%
|
|
2.0
|
%
|
|
2.3
|
%
|
|
N/A
|
Net income
|
|
$
|
252
|
|
|
$
|
749
|
|
|
$
|
724
|
|
|
$
|
197
|
|
|
$
|
256
|
|
|
$
|
1,856
|
|
|
148
|
%
|
Net income per diluted share
|
|
$
|
0.52
|
|
|
$
|
1.54
|
|
|
$
|
1.48
|
|
|
$
|
0.40
|
|
|
$
|
0.52
|
|
|
$
|
3.75
|
|
|
143
|
%
|
Net income — TTM
|
|
$
|
2,105
|
|
|
$
|
2,371
|
|
|
$
|
2,583
|
|
|
$
|
1,922
|
|
|
$
|
1,926
|
|
|
$
|
3,033
|
|
|
28
|
%
|
Net income per diluted share — TTM
|
|
$
|
4.38
|
|
|
$
|
4.90
|
|
|
$
|
5.31
|
|
|
$
|
3.94
|
|
|
$
|
3.94
|
|
|
$
|
6.15
|
|
|
26
|
%
|
______________________________
|
(1)
|
|
As a result of accounting guidance adopted in Q1 2017, we
retrospectively adjusted our consolidated statements of cash flows
to reclassify excess tax benefits from financing activities to
operating activities. The amount of the adjustment was $401 million
for TTM Q3 2016 and $829 million for TTM Q4 2016.
|
(2)
|
|
Free cash flow is cash flow from operations reduced by “Purchases
of property and equipment, including internal-use software and
website development, net of proceeds from property and equipment
incentives,” which both are included in cash flow from investing
activities.
|
(3)
|
|
Free cash flow less lease principal repayments is free cash flow
reduced by “Principal repayments of capital lease obligations,” and
“Principal repayments of finance lease obligations,” which are
included in cash flow from financing activities.
|
(4)
|
|
Free cash flow less finance lease principal repayments and assets
acquired under capital leases is free cash flow reduced by
“Principal repayments of finance lease obligations,” which is
included in cash flow from financing activities, and property and
equipment acquired under capital leases. In this measure, property
and equipment acquired under capital leases is reflected as if these
assets had been purchased with cash, which is not the case as these
assets have been leased.
|
(5)
|
|
Average Total Assets minus Current Liabilities (excluding current
portion of Long-Term Debt and current portion of capital lease
obligations and finance lease obligations) over five quarter ends.
|
|
AMAZON.COM, INC.
|
Supplemental Financial Information and Business Metrics
|
(in millions)
|
(unaudited)
|
|
|
|
Q3 2016
|
|
Q4 2016
|
|
Q1 2017
|
|
Q2 2017
|
|
Q3 2017
|
|
Q4 2017
|
|
Y/Y %
Change
|
Segments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
18,874
|
|
|
$
|
26,240
|
|
|
$
|
20,992
|
|
|
$
|
22,370
|
|
|
$
|
25,446
|
|
|
$
|
37,302
|
|
|
42
|
%
|
Net sales — Y/Y growth, excluding F/X
|
|
26
|
%
|
|
22
|
%
|
|
23
|
%
|
|
27
|
%
|
|
35
|
%
|
|
42
|
%
|
|
N/A
|
Net sales — TTM
|
|
$
|
75,045
|
|
|
$
|
79,785
|
|
|
$
|
83,781
|
|
|
$
|
88,476
|
|
|
$
|
95,048
|
|
|
$
|
106,110
|
|
|
33
|
%
|
Operating Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
$
|
255
|
|
|
$
|
816
|
|
|
$
|
596
|
|
|
$
|
436
|
|
|
$
|
112
|
|
|
$
|
1,692
|
|
|
107
|
%
|
FX impact — favorable (unfavorable)
|
|
$
|
6
|
|
|
$
|
11
|
|
|
$
|
4
|
|
|
$
|
11
|
|
|
$
|
(12
|
)
|
|
$
|
(8
|
)
|
|
N/A
|
Operating income — Y/Y growth (decline), excluding F/X
|
|
34
|
%
|
|
26
|
%
|
|
1
|
%
|
|
(40
|
)%
|
|
(51
|
)%
|
|
108
|
%
|
|
N/A
|
Operating margin — % of North America net sales
|
|
1.3
|
%
|
|
3.1
|
%
|
|
2.8
|
%
|
|
1.9
|
%
|
|
0.4
|
%
|
|
4.5
|
%
|
|
N/A
|
Operating income — TTM
|
|
$
|
2,182
|
|
|
$
|
2,361
|
|
|
$
|
2,369
|
|
|
$
|
2,102
|
|
|
$
|
1,960
|
|
|
$
|
2,837
|
|
|
20
|
%
|
Operating margin — TTM % of North America net sales
|
|
2.9
|
%
|
|
3.0
|
%
|
|
2.8
|
%
|
|
2.4
|
%
|
|
2.1
|
%
|
|
2.7
|
%
|
|
N/A
|
International Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
10,609
|
|
|
$
|
13,965
|
|
|
$
|
11,061
|
|
|
$
|
11,485
|
|
|
$
|
13,714
|
|
|
$
|
18,038
|
|
|
29
|
%
|
Net sales — Y/Y growth, excluding F/X
|
|
28
|
%
|
|
23
|
%
|
|
21
|
%
|
|
22
|
%
|
|
28
|
%
|
|
22
|
%
|
|
N/A
|
Net sales — TTM
|
|
$
|
41,860
|
|
|
$
|
43,983
|
|
|
$
|
45,477
|
|
|
$
|
47,119
|
|
|
$
|
50,224
|
|
|
$
|
54,297
|
|
|
23
|
%
|
Operating income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$
|
(541
|
)
|
|
$
|
(487
|
)
|
|
$
|
(481
|
)
|
|
$
|
(724
|
)
|
|
$
|
(936
|
)
|
|
$
|
(919
|
)
|
|
89
|
%
|
FX impact — favorable (unfavorable)
|
|
$
|
22
|
|
|
$
|
5
|
|
|
$
|
(32
|
)
|
|
$
|
(59
|
)
|
|
$
|
(13
|
)
|
|
$
|
20
|
|
|
N/A
|
Operating income/loss — Y/Y growth (decline), excluding F/X
|
|
171
|
%
|
|
354
|
%
|
|
272
|
%
|
|
393
|
%
|
|
71
|
%
|
|
93
|
%
|
|
N/A
|
Operating margin — % of International net sales
|
|
(5.1
|
)%
|
|
(3.5
|
)%
|
|
(4.4
|
)%
|
|
(6.3
|
)%
|
|
(6.8
|
)%
|
|
(5.1
|
)%
|
|
N/A
|
Operating income (loss) — TTM
|
|
$
|
(905
|
)
|
|
$
|
(1,283
|
)
|
|
$
|
(1,644
|
)
|
|
$
|
(2,233
|
)
|
|
$
|
(2,629
|
)
|
|
$
|
(3,062
|
)
|
|
139
|
%
|
Operating margin — TTM % of International net sales
|
|
(2.2
|
)%
|
|
(2.9
|
)%
|
|
(3.6
|
)%
|
|
(4.7
|
)%
|
|
(5.2
|
)%
|
|
(5.6
|
)%
|
|
N/A
|
AWS Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
3,231
|
|
|
$
|
3,536
|
|
|
$
|
3,661
|
|
|
$
|
4,100
|
|
|
$
|
4,584
|
|
|
$
|
5,113
|
|
|
45
|
%
|
Net sales — Y/Y growth, excluding F/X
|
|
55
|
%
|
|
47
|
%
|
|
43
|
%
|
|
42
|
%
|
|
42
|
%
|
|
44
|
%
|
|
N/A
|
Net sales — TTM
|
|
$
|
11,088
|
|
|
$
|
12,219
|
|
|
$
|
13,314
|
|
|
$
|
14,529
|
|
|
$
|
15,882
|
|
|
$
|
17,459
|
|
|
43
|
%
|
Operating income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
$
|
861
|
|
|
$
|
926
|
|
|
$
|
890
|
|
|
$
|
916
|
|
|
$
|
1,171
|
|
|
$
|
1,354
|
|
|
46
|
%
|
FX impact — favorable (unfavorable)
|
|
$
|
(20
|
)
|
|
$
|
(9
|
)
|
|
$
|
(3
|
)
|
|
$
|
10
|
|
|
$
|
(14
|
)
|
|
$
|
(45
|
)
|
|
N/A
|
Operating income — Y/Y growth, excluding F/X
|
|
106
|
%
|
|
61
|
%
|
|
48
|
%
|
|
26
|
%
|
|
38
|
%
|
|
51
|
%
|
|
N/A
|
Operating margin — % of AWS net sales
|
|
26.6
|
%
|
|
26.2
|
%
|
|
24.3
|
%
|
|
22.3
|
%
|
|
25.5
|
%
|
|
26.5
|
%
|
|
N/A
|
Operating income — TTM
|
|
$
|
2,762
|
|
|
$
|
3,108
|
|
|
$
|
3,395
|
|
|
$
|
3,593
|
|
|
$
|
3,903
|
|
|
$
|
4,331
|
|
|
39
|
%
|
Operating margin — TTM % of AWS net sales
|
|
24.9
|
%
|
|
25.4
|
%
|
|
25.5
|
%
|
|
24.7
|
%
|
|
24.6
|
%
|
|
24.8
|
%
|
|
N/A
|
|
AMAZON.COM, INC.
|
Supplemental Financial Information and Business Metrics
|
(in millions, except employee data)
|
(unaudited)
|
|
|
|
Q3 2016
|
|
Q4 2016
|
|
Q1 2017
|
|
Q2 2017
|
|
Q3 2017
|
|
Q4 2017
|
|
Y/Y %
Change
|
Net Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Online stores (1)
|
|
$
|
21,590
|
|
|
$
|
29,548
|
|
|
$
|
22,826
|
|
|
$
|
23,754
|
|
|
$
|
26,392
|
|
|
$
|
35,383
|
|
|
20
|
%
|
Online stores — Y/Y growth, excluding F/X
|
|
20
|
%
|
|
16
|
%
|
|
16
|
%
|
|
18
|
%
|
|
22
|
%
|
|
17
|
%
|
|
N/A
|
Physical stores (2)
|
|
|
|
|
|
|
|
|
|
$
|
1,276
|
|
|
$
|
4,522
|
|
|
N/A
|
Third-party seller services (3)
|
|
$
|
5,652
|
|
|
$
|
7,456
|
|
|
$
|
6,438
|
|
|
$
|
6,991
|
|
|
$
|
7,928
|
|
|
$
|
10,523
|
|
|
41
|
%
|
Third-party seller services — Y/Y growth, excluding F/X
|
|
46
|
%
|
|
39
|
%
|
|
36
|
%
|
|
40
|
%
|
|
40
|
%
|
|
38
|
%
|
|
N/A
|
Subscription services (4)
|
|
$
|
1,532
|
|
|
$
|
2,130
|
|
|
$
|
1,939
|
|
|
$
|
2,165
|
|
|
$
|
2,441
|
|
|
$
|
3,177
|
|
|
49
|
%
|
Subscription services — Y/Y growth, excluding F/X
|
|
47
|
%
|
|
33
|
%
|
|
52
|
%
|
|
53
|
%
|
|
59
|
%
|
|
47
|
%
|
|
N/A
|
AWS
|
|
$
|
3,231
|
|
|
$
|
3,536
|
|
|
$
|
3,661
|
|
|
$
|
4,100
|
|
|
$
|
4,584
|
|
|
$
|
5,113
|
|
|
45
|
%
|
AWS — Y/Y growth, excluding F/X
|
|
55
|
%
|
|
47
|
%
|
|
43
|
%
|
|
42
|
%
|
|
42
|
%
|
|
44
|
%
|
|
N/A
|
Other (5)
|
|
$
|
709
|
|
|
$
|
1,071
|
|
|
$
|
850
|
|
|
$
|
945
|
|
|
$
|
1,123
|
|
|
$
|
1,735
|
|
|
62
|
%
|
Other — Y/Y growth, excluding F/X
|
|
74
|
%
|
|
99
|
%
|
|
58
|
%
|
|
53
|
%
|
|
58
|
%
|
|
60
|
%
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based Compensation Expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
$
|
7
|
|
|
$
|
9
|
|
|
$
|
8
|
|
|
$
|
12
|
|
|
$
|
13
|
|
|
$
|
14
|
|
|
54
|
%
|
Fulfillment
|
|
$
|
165
|
|
|
$
|
190
|
|
|
$
|
163
|
|
|
$
|
261
|
|
|
$
|
230
|
|
|
$
|
256
|
|
|
35
|
%
|
Marketing
|
|
$
|
85
|
|
|
$
|
102
|
|
|
$
|
94
|
|
|
$
|
133
|
|
|
$
|
135
|
|
|
$
|
148
|
|
|
46
|
%
|
Technology and content
|
|
$
|
434
|
|
|
$
|
493
|
|
|
$
|
441
|
|
|
$
|
633
|
|
|
$
|
595
|
|
|
$
|
637
|
|
|
29
|
%
|
General and administrative
|
|
$
|
85
|
|
|
$
|
93
|
|
|
$
|
86
|
|
|
$
|
119
|
|
|
$
|
112
|
|
|
$
|
124
|
|
|
34
|
%
|
Total stock-based compensation expense
|
|
$
|
776
|
|
|
$
|
887
|
|
|
$
|
792
|
|
|
$
|
1,158
|
|
|
$
|
1,085
|
|
|
$
|
1,179
|
|
|
33
|
%
|
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WW shipping costs
|
|
$
|
3,897
|
|
|
$
|
5,634
|
|
|
$
|
4,383
|
|
|
$
|
4,568
|
|
|
$
|
5,401
|
|
|
$
|
7,368
|
|
|
31
|
%
|
WW shipping costs — Y/Y growth
|
|
43
|
%
|
|
35
|
%
|
|
34
|
%
|
|
36
|
%
|
|
39
|
%
|
|
31
|
%
|
|
N/A
|
WW paid units — Y/Y growth (6)
|
|
28
|
%
|
|
24
|
%
|
|
24
|
%
|
|
27
|
%
|
|
25
|
%
|
|
23
|
%
|
|
N/A
|
WW seller unit mix — % of WW paid units (6)
|
|
50
|
%
|
|
49
|
%
|
|
50
|
%
|
|
51
|
%
|
|
50
|
%
|
|
51
|
%
|
|
N/A
|
Employees (full-time and part-time; excludes contractors & temporary
personnel)
|
|
306,800
|
|
|
341,400
|
|
|
351,000
|
|
|
382,400
|
|
|
541,900
|
|
|
566,000
|
|
|
66
|
%
|
Employees (full-time and part-time; excludes contractors &
temporary personnel) — Y/Y growth
|
|
38
|
%
|
|
48
|
%
|
|
43
|
%
|
|
42
|
%
|
|
77
|
%
|
|
66
|
%
|
|
N/A
|
________________________
|
(1)
|
|
Includes product sales and digital media content where we record
revenue gross. We leverage our retail infrastructure to offer a
wide selection of consumable and durable goods that includes media
products available in both a physical and digital format, such as
books, music, videos, games, and software. These product sales
include digital products sold on a transactional basis. Digital
product subscriptions that provide unlimited viewing or usage
rights are included in Subscription services.
|
(2)
|
|
Includes product sales where our customers physically select items
in a store.
|
(3)
|
|
Includes commissions, related fulfillment and shipping fees, and
other third-party seller services.
|
(4)
|
|
Includes annual and monthly fees associated with Amazon Prime
membership, as well as audiobook, e-book, digital video, digital
music, and other non-AWS subscription services.
|
(5)
|
|
Includes sales not otherwise included above, such as certain
advertising services and our co-branded credit card agreements.
|
(6)
|
|
Excludes the impact of Whole Foods Market.
|
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 Payments customers, AWS
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. Sellers are
considered active when they have received an order from a customer
during the preceding twelve-month period.
AWS Customers
-
References to AWS customers mean unique AWS customer accounts, which
are unique customer account IDs that are eligible to use AWS services.
This includes AWS accounts in the AWS free tier. Multiple users
accessing AWS services via one account ID are counted as a single
account. Customers are considered active when they have had AWS usage
activity during the preceding one-month period.
Units
-
References to units mean physical and digital units sold (net of
returns and cancellations) by us and sellers at Amazon domains
worldwide as well as Amazon-owned items sold through non-Amazon
domains. Units sold are paid units and do not include units associated
with AWS, certain acquisitions, rental businesses, or advertising
businesses, or Amazon gift cards.
Source: Amazon.com, Inc.
Amazon.com Investor Relations Dave Fildes, amazon-ir@amazon.com www.amazon.com/ir or Amazon.com
Public Relations Ty Rogers, amazon-pr@amazon.com www.amazon.com/about
|