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Business Wire 26-Jul-2018 4:01 PM
Amazon.com, Inc. (NASDAQ:AMZN) today announced financial results for its second quarter ended June 30, 2018.
Operating cash flow increased 22% to $21.8 billion for the trailing twelve months, compared with $17.8 billion for the trailing twelve months ended June 30, 2017. Free cash flow increased to $10.4 billion for the trailing twelve months, compared with $9.6 billion for the trailing twelve months ended June 30, 2017. Free cash flow less lease principal repayments decreased to $4.1 billion for the trailing twelve months, compared with $5.4 billion for the trailing twelve months ended June 30, 2017. Free cash flow less finance lease principal repayments and assets acquired under capital leases decreased to $546 million for the trailing twelve months, compared with $1.4 billion for the trailing twelve months ended June 30, 2017.
Common shares outstanding plus shares underlying stock-based awards totaled 506 million on June 30, 2018, compared with 502 million one year ago.
Net sales increased 39% to $52.9 billion in the second quarter, compared with $38.0 billion in second quarter 2017. Excluding the $760 million favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 37% compared with second quarter 2017.
Operating income increased to $3.0 billion in the second quarter, compared with operating income of $628 million in second quarter 2017.
Net income increased to $2.5 billion in the second quarter, or $5.07 per diluted share, compared with net income of $197 million, or $0.40 per diluted share, in second quarter 2017.
"We want customers to be able to use Alexa wherever they are," said Jeff Bezos, Amazon founder and CEO. "There are now tens of thousands of developers across more than 150 countries building new devices using the Alexa Voice Service, and the number of Alexa-enabled devices has more than tripled in the past year. Our partners are creating a wide variety of new Alexa-enabled devices and experiences, including soundbars from Polk and Sonos; headphones from Jabra; smart home devices from ecobee and First Alert; Windows 10 PCs from Acer, HP, and Lenovo; and cars from automakers including BMW, Ford, and Toyota."
Highlights
Financial Guidance
The following forward-looking statements reflect Amazon.com's expectations as of July 26, 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.
Third Quarter 2018 Guidance
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 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 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 amazon.com/about and follow @AmazonNews.
AMAZON.COM, INC. | ||||||||||||||||||||||||
Consolidated Statements of Cash Flows | ||||||||||||||||||||||||
(in millions) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | Twelve Months Ended June 30, | ||||||||||||||||||||||
2017 | 2018 | 2017 | 2018 | 2017 | 2018 | |||||||||||||||||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | $ | 16,301 | $ | 17,616 | $ | 19,934 | $ | 21,856 | $ | 12,977 | $ | 13,851 | ||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||||||||||
Net income | 197 | 2,534 | 921 | 4,163 | 1,922 | 6,275 | ||||||||||||||||||
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 | 2,633 | 3,630 | 5,068 | 7,301 | 9,448 | 13,711 | ||||||||||||||||||
Stock-based compensation | 1,158 | 1,468 | 1,952 | 2,651 | 3,615 | 4,914 | ||||||||||||||||||
Other operating expense, net | 60 | 85 | 102 | 141 | 164 | 240 | ||||||||||||||||||
Other expense (income), net | (120 | ) | 110 | (160 | ) | (75 | ) | (162 | ) | (207 | ) | |||||||||||||
Deferred income taxes | 376 | (139 | ) | 354 | 3 | (8 | ) | (380 | ) | |||||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||||||
Inventories | (682 | ) | (1,090 | ) | 265 | 1,130 | (1,874 | ) | (2,717 | ) | ||||||||||||||
Accounts receivable, net and other | (1,221 | ) | (1,364 | ) | (257 | ) | (336 | ) | (2,925 | ) | (4,859 | ) | ||||||||||||
Accounts payable | 2,088 | 2,703 | (4,777 | ) | (7,513 | ) | 5,046 | 4,364 | ||||||||||||||||
Accrued expenses and other | (252 | ) |
(205 |
) | (1,657 | ) |
(2,430 |
) | 1,039 |
(491 |
) | |||||||||||||
Unearned revenue | (387 | ) |
(283 |
) |
419 |
623 |
1,537 |
943 |
||||||||||||||||
Net cash provided by (used in) operating activities | 3,850 | 7,449 | 2,230 | 5,658 | 17,802 | 21,793 | ||||||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||||||||||
Purchases of property and equipment, including internal-use software and website development | (3,113 | ) | (3,243 | ) | (5,261 | ) | (6,341 | ) | (9,763 | ) | (13,035 | ) | ||||||||||||
Proceeds from property and equipment incentives | 612 | 294 | 899 | 665 | 1,556 | 1,663 | ||||||||||||||||||
Acquisitions, net of cash acquired, and other | (633 | ) | (866 | ) | (678 | ) | (879 | ) | (765 | ) | (14,173 | ) | ||||||||||||
Sales and maturities of marketable securities | 2,070 | 1,660 | 3,980 | 4,337 | 6,530 | 10,034 | ||||||||||||||||||
Purchases of marketable securities | (4,210 | ) | (537 | ) | (5,564 | ) | (1,007 | ) | (10,731 | ) | (8,173 | ) | ||||||||||||
Net cash provided by (used in) investing activities | (5,274 | ) | (2,692 | ) | (6,624 | ) | (3,225 | ) | (13,173 | ) | (23,684 | ) | ||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||||||||||
Proceeds from long-term debt and other | 49 | 96 | 70 | 221 | 612 | 16,380 | ||||||||||||||||||
Repayments of long-term debt and other | (48 | ) | (149 | ) | (88 | ) | (351 | ) | (170 | ) | (1,564 | ) | ||||||||||||
Principal repayments of capital lease obligations | (1,228 | ) | (1,284 | ) | (2,060 | ) | (3,297 | ) | (4,003 | ) | (6,037 | ) | ||||||||||||
Principal repayments of finance lease obligations | (47 | ) | (57 | ) | (85 | ) | (129 | ) | (170 | ) | (244 | ) | ||||||||||||
Net cash provided by (used in) financing activities | (1,274 | ) | (1,394 | ) | (2,163 | ) | (3,556 | ) | (3,731 | ) | 8,535 | |||||||||||||
Foreign currency effect on cash, cash equivalents, and restricted cash | 248 | (443 | ) | 474 | (197 | ) | (24 | ) | 41 | |||||||||||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash | (2,450 | ) | 2,920 | (6,083 | ) | (1,320 | ) | 874 | 6,685 | |||||||||||||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | $ | 13,851 | $ | 20,536 | $ | 13,851 | $ | 20,536 | $ | 13,851 | $ | 20,536 | ||||||||||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||||||||||||||||||
Cash paid for interest on long-term debt | $ | 146 | $ | 168 | $ | 150 | $ | 450 | $ | 295 | $ | 628 | ||||||||||||
Cash paid for interest on capital and finance lease obligations | 62 | 125 | 123 | 254 | 234 | 449 | ||||||||||||||||||
Cash paid for income taxes, net of refunds | 447 | 300 | 693 | 813 | 879 | 1,077 | ||||||||||||||||||
Property and equipment acquired under capital leases | 2,724 | 2,335 | 4,612 | 4,605 | 8,019 | 9,631 | ||||||||||||||||||
Property and equipment acquired under build-to-suit leases | 748 | 795 | 1,948 | 1,536 | 2,575 | 3,128 |
______________________________
As a result of the adoption of new accounting guidance, we retrospectively adjusted our consolidated statements of cash flows to add restricted cash to cash and cash equivalents. |
AMAZON.COM, INC. | ||||||||||||||||
Consolidated Statements of Operations | ||||||||||||||||
(in millions, except per share data) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2017 | 2018 | 2017 | 2018 | |||||||||||||
Net product sales | $ | 24,745 | $ | 31,864 | $ | 48,479 | $ | 63,468 | ||||||||
Net service sales | 13,210 | 21,022 | 25,190 | 40,460 | ||||||||||||
Total net sales | 37,955 | 52,886 | 73,669 | 103,928 | ||||||||||||
Operating expenses: | ||||||||||||||||
Cost of sales | 23,451 | 30,632 | 45,891 | 61,367 | ||||||||||||
Fulfillment | 5,158 | 7,932 | 9,855 | 15,724 | ||||||||||||
Marketing | 2,229 | 2,901 | 4,150 | 5,600 | ||||||||||||
Technology and content | 5,549 | 7,247 | 10,363 | 14,006 | ||||||||||||
General and administrative | 874 | 1,111 | 1,669 | 2,177 | ||||||||||||
Other operating expense, net | 66 | 80 | 109 | 143 | ||||||||||||
Total operating expenses | 37,327 | 49,903 | 72,037 | 99,017 | ||||||||||||
Operating income | 628 | 2,983 | 1,632 | 4,911 | ||||||||||||
Interest income | 44 | 94 | 83 | 173 | ||||||||||||
Interest expense | (143 | ) | (343 | ) | (282 | ) | (673 | ) | ||||||||
Other income (expense), net | 137 | (129 | ) | 185 | 109 | |||||||||||
Total non-operating income (expense) | 38 | (378 | ) | (14 | ) | (391 | ) | |||||||||
Income before income taxes | 666 | 2,605 | 1,618 | 4,520 | ||||||||||||
Provision for income taxes | (467 | ) | (74 | ) | (695 | ) | (361 | ) | ||||||||
Equity-method investment activity, net of tax | (2 | ) | 3 | (2 | ) | 4 | ||||||||||
Net income | $ | 197 | $ | 2,534 | $ | 921 | $ | 4,163 | ||||||||
Basic earnings per share | $ | 0.41 | $ | 5.21 | $ | 1.93 | $ | 8.58 | ||||||||
Diluted earnings per share | $ | 0.40 | $ | 5.07 | $ | 1.87 | $ | 8.34 | ||||||||
Weighted-average shares used in computation of earnings per share: | ||||||||||||||||
Basic | 479 | 486 | 478 | 485 | ||||||||||||
Diluted | 492 | 500 | 491 | 499 | ||||||||||||
AMAZON.COM, INC. | ||||||||||||||||
Consolidated Statements of Comprehensive Income | ||||||||||||||||
(in millions) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2017 | 2018 | 2017 | 2018 | |||||||||||||
Net income | $ | 197 | $ | 2,534 | $ | 921 | $ | 4,163 | ||||||||
Other comprehensive income (loss): | ||||||||||||||||
Foreign currency translation adjustments, net of tax of $(2), $(1), $(15), and $17 | 194 | (466 | ) | 381 | (411 | ) | ||||||||||
Net change in unrealized gains (losses) on available-for-sale debt securities: | ||||||||||||||||
Unrealized gains (losses), net of tax of $3, $0, $2, and $9 | (6 | ) | 1 | (8 | ) | (40 | ) | |||||||||
Reclassification adjustment for losses (gains) included in "Other income (expense), net," net of tax of $0, $0, $0, and $0 | 2 | 1 | 5 | 1 | ||||||||||||
Net unrealized gains (losses) on available-for-sale debt securities | (4 | ) | 2 | (3 | ) | (39 | ) | |||||||||
Total other comprehensive income (loss) | 190 | (464 | ) | 378 | (450 | ) | ||||||||||
Comprehensive income | $ | 387 | $ | 2,070 | $ | 1,299 | $ | 3,713 | ||||||||
AMAZON.COM, INC. | |||||||||||||||
Segment Information | |||||||||||||||
(in millions) | |||||||||||||||
(unaudited) | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2017 | 2018 | 2017 | 2018 | ||||||||||||
North America | |||||||||||||||
Net sales | $ | 22,370 | $ | 32,169 | $ | 43,362 | $ | 62,894 | |||||||
Operating expenses | 21,934 | 30,334 | 42,330 | 59,910 | |||||||||||
Operating income | $ | 436 | $ | 1,835 | $ | 1,032 | $ | 2,984 | |||||||
International | |||||||||||||||
Net sales | $ | 11,485 | $ | 14,612 | $ | 22,546 | $ | 29,487 | |||||||
Operating expenses | 12,209 | 15,106 | 23,752 | 30,603 | |||||||||||
Operating income (loss) | $ | (724 | ) | $ | (494 | ) | $ | (1,206 | ) | $ | (1,116 | ) | |||
AWS | |||||||||||||||
Net sales | $ | 4,100 | $ | 6,105 | $ | 7,761 | $ | 11,547 | |||||||
Operating expenses | 3,184 | 4,463 | 5,955 | 8,504 | |||||||||||
Operating income | $ | 916 | $ | 1,642 | $ | 1,806 | $ | 3,043 | |||||||
Consolidated | |||||||||||||||
Net sales | $ | 37,955 | $ | 52,886 | $ | 73,669 | $ | 103,928 | |||||||
Operating expenses | 37,327 | 49,903 | 72,037 | 99,017 | |||||||||||
Operating income | 628 | 2,983 | 1,632 | 4,911 | |||||||||||
Total non-operating income (expense) | 38 | (378 | ) | (14 | ) | (391 | ) | ||||||||
Provision for income taxes | (467 | ) | (74 | ) | (695 | ) | (361 | ) | |||||||
Equity-method investment activity, net of tax | (2 | ) | 3 | (2 | ) | 4 | |||||||||
Net income | $ | 197 | $ | 2,534 | $ | 921 | $ | 4,163 | |||||||
Segment Highlights: | |||||||||||||||
Y/Y net sales growth: | |||||||||||||||
North America | 27 | % | 44 | % | 25 | % | 45 | % | |||||||
International | 17 | 27 | 16 | 31 | |||||||||||
AWS | 42 | 49 | 42 | 49 | |||||||||||
Consolidated | 25 | 39 | 24 | 41 | |||||||||||
Net sales mix: | |||||||||||||||
North America | 59 | % | 61 | % | 59 | % | 61 | % | |||||||
International | 30 | 28 | 31 | 28 | |||||||||||
AWS | 11 | 11 | 10 | 11 | |||||||||||
Consolidated | 100 | % | 100 | % | 100 | % | 100 | % | |||||||
AMAZON.COM, INC. | |||||||
Consolidated Balance Sheets | |||||||
(in millions, except per share data) | |||||||
December 31, 2017 | June 30, 2018 | ||||||
(unaudited) | |||||||
ASSETS |
|||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 20,522 | $ | 19,823 | |||
Marketable securities | 10,464 | 7,227 | |||||
Inventories | 16,047 | 14,824 | |||||
Accounts receivable, net and other | 13,164 | 12,607 | |||||
Total current assets | 60,197 | 54,481 | |||||
Property and equipment, net | 48,866 | 54,768 | |||||
Goodwill | 13,350 | 13,944 | |||||
Other assets | 8,897 | 10,907 | |||||
Total assets | $ | 131,310 | $ | 134,100 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||||
Current liabilities: | |||||||
Accounts payable | $ | 34,616 | $ | 27,657 | |||
Accrued expenses and other | 18,170 | 17,140 | |||||
Unearned revenue | 5,097 | 6,004 | |||||
Total current liabilities | 57,883 | 50,801 | |||||
Long-term debt | 24,743 | 24,638 | |||||
Other long-term liabilities | 20,975 | 23,666 | |||||
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 — 507 and 511 | |||||||
Outstanding shares — 484 and 487 | 5 | 5 | |||||
Treasury stock, at cost | (1,837 | ) | (1,837 | ) | |||
Additional paid-in capital | 21,389 | 24,028 | |||||
Accumulated other comprehensive loss | (484 | ) | (934 | ) | |||
Retained earnings | 8,636 | 13,733 | |||||
Total stockholders' equity | 27,709 | 34,995 | |||||
Total liabilities and stockholders' equity | $ | 131,310 | $ | 134,100 | |||
AMAZON.COM, INC. | |||||||||||||||||||||||||||
Supplemental Financial Information and Business Metrics | |||||||||||||||||||||||||||
(in millions, except per share data) | |||||||||||||||||||||||||||
(unaudited) | |||||||||||||||||||||||||||
Q1 2017 | Q2 2017 | Q3 2017 | Q4 2017 | Q1 2018 | Q2 2018 |
Y/Y %
Change |
|||||||||||||||||||||
Cash Flows and Shares | |||||||||||||||||||||||||||
Operating cash flow -- trailing twelve months (TTM) (1) | $ | 17,547 | $ | 17,802 | $ | 16,996 | $ | 18,365 | $ | 18,194 | $ | 21,793 | 22 | % | |||||||||||||
Operating cash flow -- TTM Y/Y growth | 52 | % | 36 | % | 13 | % | 7 | % | 4 | % | 22 | % | N/A | ||||||||||||||
Purchases of property and equipment, including internal-use software and website development, net of proceeds from property and equipment incentives -- TTM | $ | 7,417 | $ | 8,207 | $ | 9,027 | $ | 10,058 | $ | 10,924 | $ | 11,372 | 39 | % | |||||||||||||
Principal repayments of capital lease obligations -- TTM | $ | 3,891 | $ | 4,003 | $ | 4,331 | $ | 4,799 | $ | 5,981 | $ | 6,037 | 51 | % | |||||||||||||
Principal repayments of finance lease obligations -- TTM | $ | 155 | $ | 170 | $ | 175 | $ | 200 | $ | 235 | $ | 244 | 44 | % | |||||||||||||
Property and equipment acquired under capital leases -- TTM | $ | 6,717 | $ | 8,019 | $ | 8,905 | $ | 9,637 | $ | 10,020 | $ | 9,631 | 20 | % | |||||||||||||
Free cash flow -- TTM (1) (2) | $ | 10,130 | $ | 9,595 | $ | 7,969 | $ | 8,307 | $ | 7,270 | $ | 10,421 | 9 | % | |||||||||||||
Free cash flow less lease principal repayments -- TTM (1) (3) | $ | 6,084 | $ | 5,422 | $ | 3,463 | $ | 3,308 | $ | 1,054 | $ | 4,140 | (24 | )% | |||||||||||||
Free cash flow less finance lease principal repayments and assets acquired under capital leases -- TTM (1) (4) | $ | 3,258 | $ | 1,406 | $ | (1,111 | ) | $ | (1,530 | ) | $ | (2,985 | ) | $ | 546 | (61 | )% | ||||||||||
Invested capital (5) | $ | 42,114 | $ | 45,537 | $ | 52,690 | $ | 60,368 | $ | 68,377 | $ | 76,600 | 68 | % | |||||||||||||
Common shares and stock-based awards outstanding | 497 | 502 | 503 | 504 | 504 | 506 | 1 | % | |||||||||||||||||||
Common shares outstanding | 478 | 480 | 482 | 484 | 485 | 487 | 1 | % | |||||||||||||||||||
Stock-based awards outstanding | 20 | 22 | 21 | 20 | 19 | 19 | (12 | )% | |||||||||||||||||||
Stock-based awards outstanding -- % of common shares outstanding | 4.1 | % | 4.5 | % | 4.4 | % | 4.2 | % | 3.9 | % | 3.9 | % | N/A | ||||||||||||||
Results of Operations | |||||||||||||||||||||||||||
Worldwide (WW) net sales | $ | 35,714 | $ | 37,955 | $ | 43,744 | $ | 60,453 | $ | 51,042 | $ | 52,886 | 39 | % | |||||||||||||
WW net sales -- Y/Y growth, excluding F/X | 24 | % | 26 | % | 33 | % | 36 | % | 39 | % | 37 | % | N/A | ||||||||||||||
WW net sales -- TTM | $ | 142,572 | $ | 150,123 | $ | 161,154 | $ | 177,866 | $ | 193,194 | $ | 208,125 | 39 | % | |||||||||||||
WW net sales -- TTM Y/Y growth, excluding F/X | 26 | % | 26 | % | 27 | % | 31 | % | 34 | % | 36 | % | N/A | ||||||||||||||
Operating income | $ | 1,005 | $ | 628 | $ | 347 | $ | 2,127 | $ | 1,927 | $ | 2,983 | 375 | % | |||||||||||||
F/X impact -- favorable (unfavorable) | $ | (31 | ) | $ | (38 | ) | $ | (39 | ) | $ | (33 | ) | $ | (29 | ) | $ | 42 | N/A | |||||||||
Operating income -- Y/Y growth (decline), excluding F/X | (3 | )% | (48 | )% | (33 | )% | 72 | % | 95 | % | 369 | % | N/A | ||||||||||||||
Operating margin -- % of WW net sales | 2.8 | % | 1.7 | % | 0.8 | % | 3.5 | % | 3.8 | % | 5.6 | % | N/A | ||||||||||||||
Operating income -- TTM | $ | 4,120 | $ | 3,462 | $ | 3,234 | $ | 4,106 | $ | 5,028 | $ | 7,384 | 113 | % | |||||||||||||
Operating income -- TTM Y/Y growth (decline), excluding F/X | 34 | % | (9 | )% | (17 | )% | 1 | % | 25 | % | 115 | % | N/A | ||||||||||||||
Operating margin -- TTM % of WW net sales | 2.9 | % | 2.3 | % | 2.0 | % | 2.3 | % | 2.6 | % | 3.5 | % | N/A | ||||||||||||||
Net income | $ | 724 | $ | 197 | $ | 256 | $ | 1,856 | $ | 1,629 | $ | 2,534 | N/A | ||||||||||||||
Net income per diluted share | $ | 1.48 | $ | 0.40 | $ | 0.52 | $ | 3.75 | $ | 3.27 | $ | 5.07 | N/A | ||||||||||||||
Net income -- TTM | $ | 2,583 | $ | 1,922 | $ | 1,926 | $ | 3,033 | $ | 3,938 | $ | 6,275 | 226 | % | |||||||||||||
Net income per diluted share -- TTM | $ | 5.31 | $ | 3.94 | $ | 3.94 | $ | 6.15 | $ | 7.90 | $ | 12.63 | 221 | % |
______________________________
(1) | As a result of the adoption of new accounting guidance, we retrospectively adjusted our consolidated statements of cash flows to add restricted cash to cash and cash equivalents. | |
(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) | |||||||||||||||||||||||||||
Q1 2017 | Q2 2017 | Q3 2017 | Q4 2017 | Q1 2018 | Q2 2018 |
Y/Y %
Change |
|||||||||||||||||||||
Segments | |||||||||||||||||||||||||||
North America Segment: | |||||||||||||||||||||||||||
Net sales | $ | 20,992 | $ | 22,370 | $ | 25,446 | $ | 37,302 | $ | 30,725 | $ | 32,169 | 44 | % | |||||||||||||
Net sales -- Y/Y growth, excluding F/X | 23 | % | 27 | % | 35 | % | 42 | % | 46 | % | 44 | % | N/A | ||||||||||||||
Net sales -- TTM | $ | 83,781 | $ | 88,476 | $ | 95,048 | $ | 106,110 | $ | 115,843 | $ | 125,642 | 42 | % | |||||||||||||
Operating Income: | |||||||||||||||||||||||||||
Operating income | $ | 596 | $ | 436 | $ | 112 | $ | 1,692 | $ | 1,149 | $ | 1,835 | 321 | % | |||||||||||||
F/X impact -- favorable (unfavorable) | $ | 4 | $ | 11 | $ | (12 | ) | $ | (8 | ) | $ | (10 | ) | $ | 1 | N/A | |||||||||||
Operating income -- Y/Y growth (decline), excluding F/X | 1 | % | (40 | )% | (51 | )% | 108 | % | 95 | % | 321 | % | N/A | ||||||||||||||
Operating margin -- % of North America net sales | 2.8 | % | 1.9 | % | 0.4 | % | 4.5 | % | 3.7 | % | 5.7 | % | N/A | ||||||||||||||
Operating income -- TTM | $ | 2,369 | $ | 2,102 | $ | 1,960 | $ | 2,837 | $ | 3,390 | $ | 4,788 | 128 | % | |||||||||||||
Operating margin -- TTM % of North America net sales | 2.8 | % | 2.4 | % | 2.1 | % | 2.7 | % | 2.9 | % | 3.8 | % | N/A | ||||||||||||||
International Segment: | |||||||||||||||||||||||||||
Net sales | $ | 11,061 | $ | 11,485 | $ | 13,714 | $ | 18,038 | $ | 14,875 | $ | 14,612 | 27 | % | |||||||||||||
Net sales -- Y/Y growth, excluding F/X | 21 | % | 22 | % | 28 | % | 22 | % | 21 | % | 21 | % | N/A | ||||||||||||||
Net sales -- TTM | $ | 45,477 | $ | 47,119 | $ | 50,224 | $ | 54,297 | $ | 58,111 | $ | 61,239 | 30 | % | |||||||||||||
Operating income (loss): | |||||||||||||||||||||||||||
Operating income (loss) | $ | (481 | ) | $ | (724 | ) | $ | (936 | ) | $ | (919 | ) | $ | (622 | ) | $ | (494 | ) | 32 | % | |||||||
F/X impact -- favorable (unfavorable) | $ | (32 | ) | $ | (59 | ) | $ | (13 | ) | $ | 20 | $ | 70 | $ | 86 | N/A | |||||||||||
Operating income/loss -- Y/Y growth (decline), excluding F/X | 272 | % | 393 | % | 71 | % | 93 | % | 44 | % | 20 | % | N/A | ||||||||||||||
Operating margin -- % of International net sales | (4.4 | )% | (6.3 | )% | (6.8 | )% | (5.1 | )% | (4.2 | )% | (3.4 | )% | N/A | ||||||||||||||
Operating income (loss) -- TTM | $ | (1,644 | ) | $ | (2,233 | ) | $ | (2,629 | ) | $ | (3,062 | ) | $ | (3,202 | ) | $ | (2,971 | ) | 33 | % | |||||||
Operating margin -- TTM % of International net sales | (3.6 | )% | (4.7 | )% | (5.2 | )% | (5.6 | )% | (5.5 | )% | (4.9 | )% | N/A | ||||||||||||||
AWS Segment: | |||||||||||||||||||||||||||
Net sales | $ | 3,661 | $ | 4,100 | $ | 4,584 | $ | 5,113 | $ | 5,442 | $ | 6,105 | 49 | % | |||||||||||||
Net sales -- Y/Y growth, excluding F/X | 43 | % | 42 | % | 42 | % | 44 | % | 48 | % | 49 | % | N/A | ||||||||||||||
Net sales -- TTM | $ | 13,314 | $ | 14,529 | $ | 15,882 | $ | 17,459 | $ | 19,240 | $ | 21,244 | 46 | % | |||||||||||||
Operating income: | |||||||||||||||||||||||||||
Operating income | $ | 890 | $ | 916 | $ | 1,171 | $ | 1,354 | $ | 1,400 | $ | 1,642 | 79 | % | |||||||||||||
F/X impact -- favorable (unfavorable) | $ | (3 | ) | $ | 10 | $ | (14 | ) | $ | (45 | ) | $ | (89 | ) | $ | (45 | ) | N/A | |||||||||
Operating income -- Y/Y growth, excluding F/X | 48 | % | 26 | % | 38 | % | 51 | % | 67 | % | 84 | % | N/A | ||||||||||||||
Operating margin -- % of AWS net sales | 24.3 | % | 22.3 | % | 25.5 | % | 26.5 | % | 25.7 | % | 26.9 | % | N/A | ||||||||||||||
Operating income -- TTM | $ | 3,395 | $ | 3,593 | $ | 3,903 | $ | 4,331 | $ | 4,840 | $ | 5,567 | 55 | % | |||||||||||||
Operating margin -- TTM % of AWS net sales | 25.5 | % | 24.7 | % | 24.6 | % | 24.8 | % | 25.2 | % | 26.2 | % | N/A | ||||||||||||||
AMAZON.COM, INC. | |||||||||||||||||||||||||||
Supplemental Financial Information and Business Metrics | |||||||||||||||||||||||||||
(in millions, except employee data) | |||||||||||||||||||||||||||
(unaudited) | |||||||||||||||||||||||||||
Q1 2017 | Q2 2017 | Q3 2017 | Q4 2017 | Q1 2018 | Q2 2018 |
Y/Y %
Change |
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Net Sales: | |||||||||||||||||||||||||||
Online stores (1) | $ | 22,826 | $ | 23,754 | $ | 26,392 | $ | 35,383 | $ | 26,939 | $ | 27,165 | 14 | % | |||||||||||||
Online stores - Y/Y growth, excluding F/X | 16 | % | 18 | % | 22 | % | 17 | % | 13 | % | 12 | % | N/A | ||||||||||||||
Physical stores (2) | $ | 1,276 | $ | 4,522 | $ | 4,263 | $ | 4,312 | N/A | ||||||||||||||||||
Third-party seller services (3) | $ | 6,438 | $ | 6,991 | $ | 7,928 | $ | 10,523 | $ | 9,265 | $ | 9,702 | 39 | % | |||||||||||||
Third-party seller services - Y/Y growth, excluding F/X | 36 | % | 40 | % | 40 | % | 38 | % | 39 | % | 36 | % | N/A | ||||||||||||||
Subscription services (4) | $ | 1,939 | $ | 2,165 | $ | 2,441 | $ | 3,177 | $ | 3,102 | $ | 3,408 | 57 | % | |||||||||||||
Subscription services - Y/Y growth, excluding F/X | 52 | % | 53 | % | 59 | % | 47 | % | 56 | % | 55 | % | N/A | ||||||||||||||
AWS | $ | 3,661 | $ | 4,100 | $ | 4,584 | $ | 5,113 | $ | 5,442 | $ | 6,105 | 49 | % | |||||||||||||
AWS - Y/Y growth, excluding F/X | 43 | % | 42 | % | 42 | % | 44 | % | 48 | % | 49 | % | N/A | ||||||||||||||
Other (5) | $ | 850 | $ | 945 | $ | 1,123 | $ | 1,735 | $ | 2,031 | $ | 2,194 | 132 | % | |||||||||||||
Other - Y/Y growth, excluding F/X | 58 | % | 53 | % | 58 | % | 60 | % | 132 | % | 129 | % | N/A | ||||||||||||||
Stock-based Compensation Expense | |||||||||||||||||||||||||||
Cost of sales | $ | 8 | $ | 12 | $ | 13 | $ | 14 | $ | 15 | $ | 19 | 55 | % | |||||||||||||
Fulfillment | $ | 163 | $ | 261 | $ | 230 | $ | 256 | $ | 244 | $ | 320 | 22 | % | |||||||||||||
Marketing | $ | 94 | $ | 133 | $ | 135 | $ | 148 | $ | 161 | $ | 190 | 42 | % | |||||||||||||
Technology and content | $ | 441 | $ | 633 | $ | 595 | $ | 637 | $ | 631 | $ | 788 | 25 | % | |||||||||||||
General and administrative | $ | 86 | $ | 119 | $ | 112 | $ | 124 | $ | 132 | $ | 151 | 27 | % | |||||||||||||
Total stock-based compensation expense | $ | 792 | $ | 1,158 | $ | 1,085 | $ | 1,179 | $ | 1,183 | $ | 1,468 | 27 | % | |||||||||||||
Other | |||||||||||||||||||||||||||
WW shipping costs | $ | 4,383 | $ | 4,568 | $ | 5,401 | $ | 7,368 | $ | 6,069 | $ | 5,990 | 31 | % | |||||||||||||
WW shipping costs -- Y/Y growth | 34 | % | 36 | % | 39 | % | 31 | % | 38 | % | 31 | % | N/A | ||||||||||||||
WW paid units -- Y/Y growth (6) | 24 | % | 27 | % | 25 | % | 23 | % | 22 | % | 17 | % | N/A | ||||||||||||||
WW seller unit mix -- % of WW paid units (6) | 50 | % | 51 | % | 50 | % | 51 | % | 52 | % | 53 | % | N/A | ||||||||||||||
Employees (full-time and part-time; excludes contractors & temporary personnel) | 351,000 | 382,400 | 541,900 | 566,000 | 563,100 | 575,700 | 51 | % | |||||||||||||||||||
Employees (full-time and part-time; excludes contractors & temporary personnel) -- Y/Y growth | 43 | % | 42 | % | 77 | % | 66 | % | 60 | % | 51 | % | 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 and any 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) | Primarily includes sales of advertising services, as well as sales related to our other service offerings. | |
(6) | Excludes the impact of Whole Foods Market. | |
Amazon.com, Inc.Certain Definitions
Customer Accounts
Seller Accounts
AWS Customers
Units
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