SEATTLE, Jan 27, 2011 (BUSINESS WIRE) --Amazon.com, Inc. (NASDAQ:AMZN) today announced financial results for its fourth quarter ended December 31, 2010.

 

Operating cash flow increased 6% to $3.50 billion for the trailing twelve months, compared with $3.29 billion for the trailing twelve months ended December 31, 2009. Free cash flow decreased 14% to $2.52 billion for the trailing twelve months, compared with $2.92 billion for the trailing twelve months ended December 31, 2009.

Common shares outstanding plus shares underlying stock-based awards totaled 465 million on December 31, 2010, compared with 461 million a year ago.

Net sales increased 36% to $12.95 billion in the fourth quarter, compared with $9.52 billion in fourth quarter 2009. Excluding the $139 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales would have grown 37% compared with fourth quarter 2009.

Operating income was $474 million in the fourth quarter, compared with $476 million in fourth quarter 2009. The unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter on operating income was $18 million.

Net income increased 8% to $416 million in the fourth quarter, or $0.91 per diluted share, compared with net income of $384 million, or $0.85 per diluted share, in fourth quarter 2009.

"Thanks to our customers, we achieved two big milestones," said Jeff Bezos, founder and CEO of Amazon.com. "We had our first $10 billion quarter, and after selling millions of third-generation Kindles with the new Pearl e-ink display during the quarter, Kindle books have now overtaken paperback books as the most popular format on Amazon.com. Last July we announced that Kindle books had passed hardcovers and predicted that Kindle would surpass paperbacks in the second quarter of this year, so this milestone has come even sooner than we expected - and it's on top of continued growth in paperback sales."

Full Year 2010

Net sales increased 40% to $34.20 billion, compared with $24.51 billion in 2009. The unfavorable impact from year-over-year changes in foreign exchange rates throughout the year on net sales was $86 million.

Operating income increased 25% to $1.41 billion, compared with $1.13 billion in 2009. The unfavorable impact from year-over-year changes in foreign exchange rates throughout the year on operating income was $28 million. In 2009, operating income was negatively impacted by a $51 million legal settlement.

Net income increased 28% to $1.15 billion in 2010, or $2.53 per diluted share, compared with net income of $902 million, or $2.04 per diluted share, in 2009.

Highlights

  • Amazon.com is now selling more Kindle books than paperback books. Since the beginning of the year, for every 100 paperback books Amazon has sold, the Company has sold 115 Kindle books. Additionally, during this same time period the Company has sold three times as many Kindle books as hardcover books. This is across Amazon.com's entire U.S. book business and includes sales of books where there is no Kindle edition. Free Kindle books are excluded and if included would make the numbers even higher.
  • The Company sold millions of third-generation Kindle devices with the new advanced paper-like Pearl e-ink display in the fourth quarter and the third-generation Kindle eclipsed "Harry Potter and the Deathly Hallows" as the bestselling product in Amazon's history.
  • The U.S. Kindle Store now has more than 810,000 books including New Releases and 107 of 112 New York Times Bestsellers. Over 670,000 of these books are $9.99 or less, including 74 New York Times Bestsellers. Millions of free, out-of-copyright, pre-1923 books are also available to read on Kindle.
  • Amazon added to its growing list of "Buy Once, Read Everywhere" Kindle apps, launching a Kindle app for Windows Phone 7. In addition, the Kindle for Android app was updated to enable users to buy, read and sync over 100 Kindle newspapers and magazines. All Kindle apps let customers "Buy Once, Read Everywhere"--on Kindle, Kindle 3G, Kindle DX, iPad, iPod touch, iPhone, Mac, PC, BlackBerry and Android-based devices. All Kindle apps are free and incorporate Amazon's Whispersync technology, which allows readers to seamlessly switch between devices. With Kindle Worry-Free Archive, books purchased from the Kindle Store are automatically backed up online in the Kindle library on Amazon where they can be re-downloaded wirelessly for free, anytime.
  • The Company announced Price Check for iPhone, a new price comparison app that provides shoppers an easy way to compare in-store prices with the low prices from Amazon.com and other online merchants. Shoppers can use the app to scan a barcode, snap a picture, or say or type a product name to instantly see online prices for that item. Over the Black Friday-Cyber Monday weekend, mobile shoppers used Price Check to look up prices over a million times. In December, shoppers used the app more than two million times to check prices.
  • North America segment sales, representing the Company's U.S. and Canadian sites, were $7.21 billion, up 45% from fourth quarter 2009.
  • International segment sales, representing the Company's U.K., German, Japanese, French, Chinese and Italian sites, were $5.74 billion, up 26% from fourth quarter 2009. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 29%.
  • Worldwide Media sales grew 12% to $5.23 billion. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 13%.
  • Worldwide Electronics & Other General Merchandise sales grew 60% to $7.39 billion. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 62%.
  • The Company launched Amazon.it, an Italian-language website offering customers a vast selection of books, DVDs, video games, music and consumer electronics at everyday low prices. Amazon.it's convenient services include Amazon Prime, the membership program with unlimited free guaranteed 2-3 day delivery at an annual fee of 9.99 Euros. The first product sold on Amazon.it was a Canon Pixma printer to a new Prime customer in Turino, Italy.
  • Amazon Web Services (AWS) announced lowered usage pricing on existing Premium Support offerings by 50% and added two new support plans to meet the needs of developers and enterprises of all sizes and technical ability. In addition to the existing Silver and Gold support plans, AWS now offers a Bronze support plan for $49 per month and a Platinum support plan that provides 15 minute response times and dedicated Technical Account Managers.
  • AWS achieved Level 1 Payment Card Industry (PCI) compliance, continuing its commitment to providing the security certifications developers and enterprises care about. Merchants and other service providers can now run their applications on AWS PCI-compliant technology infrastructure to store, process and transmit credit card information in the cloud.
  • AWS launched Elastic Beanstalk, an easy way for developers to quickly deploy applications to AWS and manage applications in the AWS cloud. Elastic Beanstalk automatically scales up and down as needed so developers don't need to worry about configuring their infrastructure requirements in AWS. Unlike existing application containers or "platform as a service" offerings that force developers to accept infrastructure decisions pre-determined by the vendor, Elastic Beanstalk allows developers to "open the hood" to tinker with the AWS resources powering their applications. AWS customers can now choose to have as much automation or as much control as they wish.

 

Financial Guidance

The following forward-looking statements reflect Amazon.com's expectations as of January 27, 2011. Our results are inherently unpredictable and may be materially affected by many factors, such as fluctuations in foreign exchange rates, changes in global economic conditions and consumer spending, world events, the rate of growth of the Internet and online commerce and the various factors detailed below.

First Quarter 2011 Guidance

  • Net sales are expected to be between $9.1 billion and $9.9 billion, or to grow between 28% and 39% compared with first quarter 2010.
  • Operating income is expected to be between $260 million and $385 million, or between 34% decline and 2% decline compared with first quarter 2010.
  • This guidance includes approximately $140 million for stock-based compensation and amortization of intangible assets, and it assumes, among other things, that no additional business acquisitions or investments are concluded and that there are no further revisions to stock-based compensation estimates.

 

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

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

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

About Amazon.com

Amazon.com, Inc. (NASDAQ:AMZN), a Fortune 500 company based in Seattle, opened on the World Wide Web in July 1995 and today offers Earth's Biggest Selection. Amazon.com, Inc. seeks to be Earth's most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. Amazon.com and other sellers offer millions of unique new, refurbished and used items in categories such as Books; Movies, Music & Games; Digital Downloads; Electronics & Computers; Home & Garden; Toys, Kids & Baby; Grocery; Apparel, Shoes & Jewelry; Health & Beauty; Sports & Outdoors; and Tools, Auto & Industrial. Amazon Web Services provides Amazon's developer customers with access to in-the-cloud infrastructure services based on Amazon's own back-end technology platform, which developers can use to enable virtually any type of business. Kindle, Kindle 3G and Kindle DX are the revolutionary portable readers that wirelessly download books, magazines, newspapers, blogs and personal documents to a crisp, high-resolution electronic ink display that looks and reads like real paper. Kindle 3G and Kindle DX utilize the same 3G wireless technology as advanced cell phones, so users never need to hunt for a Wi-Fi hotspot. Kindle is the #1 bestselling product across the millions of items sold on Amazon.

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, and www.amazon.it. As used herein, "Amazon.com," "we," "our" and similar terms include Amazon.com, Inc., and its subsidiaries, unless the context indicates otherwise.

AMAZON.COM, INC.
Consolidated Statements of Cash Flows
(in millions)
(unaudited)
         
         
         
  Three Months Ended Twelve Months Ended
  December 31, December 31,
  2010 2009 2010 2009
         
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD $1,539 

 

$2,514  $3,444  $2,769 
         
OPERATING ACTIVITIES:        
Net income  416   384   1,152   902 

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

        

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

  170   112   568   378 
Stock-based compensation  120   100   424   341 
Other operating expense (income), net  29   21   106   103 
Losses (gains) on sales of marketable securities, net  -   (1)  (2)  (4)
Other expense (income), net  (17)  6   (79)  (15)
Deferred income taxes  48   (1)  4   81 
Excess tax benefits from stock-based compensation  (23)  (52)  (259)  (105)
Changes in operating assets and liabilities:        
Inventories  (693)  (340)  (1,019)  (531)
Accounts receivable, net and other  (531)  (509)  (295)  (481)
Accounts payable  3,442   2,231   2,373   1,859 
Accrued expenses and other  596   429   740   300 
Additions to unearned revenue  186   444   687   1,054 
Amortization of previously unearned revenue  (263)  (214)  (905)  (589)
Net cash provided by (used in) operating activities  3,480   2,610   3,495   3,293 
         
INVESTING ACTIVITIES:        

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

  (328)  (137)  (979)  (373)
Acquisitions, net of cash acquired, and other  (271)  1   (352)  (40)
Sales and maturities of marketable securities and other investments  1,112   688   4,250   1,966 
Purchases of marketable securities and other investments  (1,728)  (2,160)  (6,279)  (3,890)
Net cash provided by (used in) investing activities  (1,215)  (1,608)  (3,360)  (2,337)
         
FINANCING ACTIVITIES:        
Excess tax benefits from stock-based compensation  23   52   259   105 
Proceeds from long-term debt and other  43   25   143   87 
Repayments of long-term debt and of capital and financing leases  (100)  (128)  (221)  (472)
Net cash provided by (used in) financing activities  (34)  (51)  181   (280)
         
Foreign-currency effect on cash and cash equivalents  7   (21)  17   (1)
Net increase (decrease) in cash and cash equivalents  2,238   930   333   675 
         
CASH AND CASH EQUIVALENTS, END OF PERIOD $3,777  $3,444  $3,777  $3,444 
         
SUPPLEMENTAL CASH FLOW INFORMATION:        
Cash paid for interest $3  $2  $11  $32 
Cash paid for income taxes  13   4   75   48 
Fixed assets acquired under capital leases  122   50   405   147 
Fixed assets acquired under build-to-suit leases  14   55   172   188 
AMAZON.COM, INC.
Consolidated Statements of Operations
(in millions, except per share data)
(unaudited)
         
         
         
  Three Months Ended Twelve Months Ended
  December 31, December 31,
  2010 2009 2010 2009
         
Net sales $12,948  $9,519  $34,204  $24,509 
         
Operating expenses (1):        
Cost of sales  10,317   7,543   26,561   18,978 
Fulfillment  1,090   755   2,898   2,052 
Marketing  376   274   1,029 

 

 680 
Technology and content  519   350   1,734   1,240 
General and administrative  143   100   470   328 
Other operating expense (income), net (2)  29   21   106   102 
Total operating expenses  12,474   9,043   32,798   23,380 
         
Income from operations  474   476   1,406 

 

 1,129 
         
Interest income  14   9   51   37 
Interest expense  (11)  (8)  (39)  (34)
Other income (expense), net  29   (6)  79   29 
Total non-operating income (expense)  32   (5)  91   32 
         
Income before income taxes  506   471 

 

 1,497 

 

 1,161 
         
Provision for income taxes  (84)  (85)  (352)  (253)
Equity-method investment activity, net of tax  (6)  (2)  7   (6)
Net income $416  $384  $1,152  $902 
         
Basic earnings per share $0.93  $0.87 

 

$2.58 

 

$2.08 
         
Diluted earnings per share $0.91  $0.85 

 

$2.53 

 

$2.04 
         
         
Weighted average shares used in computation of earnings per share:    

 

 

 

 
Basic  450   440   447   433 
Diluted  458   450   456   442 
__________________________        
(1) Includes stock-based compensation as follows:        
Fulfillment $25  $23  $90  $79 
Marketing  7   6   27   20 
Technology and content  63   52   223   182 
General and administrative  24   19   84   60 
         
(2) Q2 2009 was negatively impacted by a $51 million legal settlement.
AMAZON.COM, INC.
Segment Information
(in millions)
(unaudited)
         
         
         
  Three Months Ended Twelve Months Ended
  December 31, December 31,
  2010 2009 2010 2009
North America        
Net sales $7,211  $4,956  $18,707  $12,828 
Segment operating expenses (1)  6,916   4,678   17,752   12,119 
Segment operating income $295  $278  $955  $709 
         
International        
Net sales $5,737  $4,563  $15,497  $11,681 
Segment operating expenses (1)  5,410   4,244   14,516   10,818 
Segment operating income $327  $319  $981  $863 
         
Consolidated        
Net sales $12,948  $9,519  $34,204  $24,509 
Segment operating expenses  12,326   8,922   32,268   22,937 
Segment operating income  622   597   1,936   1,572 
Stock-based compensation  (119)  (100)  (424)  (341)
Other operating income (expense), net (2)  (29)  (21)  (106)  (102)
Income from operations  474   476   1,406   1,129 
Total non-operating income (expense)  32   (5)  91   32 
Provision for income taxes  (84)  (85)  (352)  (253)
Equity-method investment activity, net of tax  (6)  (2)  7   (6)
Net income $416  $384  $1,152  $902 
         
Segment Highlights:        
Y/Y net sales growth:        
North America  45%  36%  46%  25%
International  26   49   33   31 
Consolidated  36   42   40   28 
Y/Y segment operating income growth:        
North America  6%  113%  35%  60%
International  3   39   14   33 
Consolidated  4   66   23   44 
Net sales mix:        
North America  56%  52%  55%  52%
International  44   48   45   48 
   100%  100%  100%  100%
__________________________        

(1) A majority of our costs for "Technology and content" are incurred in the United States and most of these costs are allocated to our North America segment.

         
(2) Q2 2009 was negatively impacted by a $51 million legal settlement.
AMAZON.COM, INC.
Supplemental Net Sales Information
(in millions)
(unaudited)
         
         
         
  Three Months Ended Twelve Months Ended
  December 31, December 31,
  2010 2009 2010 2009
North America        
Media $2,370  $2,099  $6,881  $5,964 
Electronics and other general merchandise  4,558   2,662   10,998   6,314 
Other  283   195   828   550 
Total North America $7,211  $4,956  $18,707  $12,828 
         
International        
Media $2,865  $2,580  $8,007  $6,810 
Electronics and other general merchandise  2,834   1,947   7,365   4,768 
Other  38   36   125   103 
Total International $5,737  $4,563  $15,497  $11,681 
         
Consolidated        
Media $5,235  $4,679  $14,888  $12,774 
Electronics and other general merchandise  7,392   4,609   18,363   11,082 
Other  321   231   953   653 
Total Consolidated $12,948  $9,519  $34,204  $24,509 
         
Y/Y Net Sales Growth:        
North America:        
Media  13%  20%  15%  11%
Electronics and other general merchandise  71   54   74   43 
Other  45   33   50   23 
Total North America  45   36   46   25 
         
International:        
Media  11%  37%  18%  19%
Electronics and other general merchandise  46   68   54   53 
Other  6   27   22   9 
Total International  26   49   33   31 
         
Consolidated:        
Media  12%  29%  17%  15%
Electronics and other general merchandise  60   60   66   47 
Other  39   32   46   20 
Total Consolidated  36   42   40   28 
         
Y/Y Net Sales Growth Excluding Effect of Exchange Rates:        
International:        
Media  13%  26%  18%  20%
Electronics and other general merchandise  50   56   57   56 
Other  10   18   24   19 
Total International  29   37   34   33 
         
Consolidated:        
Media  13%  23%  16%  16%
Electronics and other general merchandise  62   54   67   48 
Other  40   30   46   22 
Total Consolidated  37   37   40   29 
         
Consolidated Net Sales Mix:        
Media  40%  49%  43%  52%
Electronics and other general merchandise  57   48   54   45 
Other  3   3   3   3 
   100%  100%  100%  100%
AMAZON.COM, INC.
Consolidated Balance Sheets
(in millions, except per share data)
     
     
     
  December 31, December 31,
  2010 2009
ASSETS (unaudited)  
Current assets:    
Cash and cash equivalents $3,777  $3,444 
Marketable securities  4,985   2,922 
Inventories  3,202   2,171 
Accounts receivable, net and other  1,587   988 
Deferred tax assets  196   272 
Total current assets  13,747   9,797 
Fixed assets, net  2,414   1,290 
Deferred tax assets  22   18 
Goodwill  1,349   1,234 
Other assets  1,265   1,474 
Total assets $18,797  $13,813 
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current liabilities:    
Accounts payable $8,051  $5,605 
Accrued expenses and other  2,321   1,759 
Total current liabilities  10,372   7,364 
Long-term liabilities  1,561   1,192 
     
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 -- 468 and 461    
Outstanding shares -- 451 and 444  5   5 
Treasury stock, at cost  (600)  (600)
Additional paid-in capital  6,325   5,736 
Accumulated other comprehensive loss  (190)  (56)
Retained earnings  1,324   172 
Total stockholders' equity  6,864   5,257 
Total liabilities and stockholders' equity $18,797  $13,813 
AMAZON.COM, INC.
Supplemental Financial Information and Business Metrics
(in millions, except per share data)
(unaudited)
             
            Y/Y %
  Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Change
Cash Flows and Shares            
Operating cash flow -- trailing twelve months (TTM) $3,293  $2,780  $2,561  $2,617  $3,495  6%
Purchases of fixed assets (incl. internal-use software & website development) -- TTM $373  $458  $575  $788  $979  163%
Free cash flow (operating cash flow less purchases of fixed assets) -- TTM $2,920  $2,322  $1,986  $1,829  $2,516  (14%)
Free cash flow -- TTM Y/Y growth  114%  62%  29%  (5%)  (14%) N/A 
Invested capital (1) $4,449  $5,104  $5,820  $6,576  $7,380  N/A 
Return on invested capital (2)  66%  45%  34%  28%  34% N/A 
             
Common shares and stock-based awards outstanding  461   463   465   465   465  1%
Common shares outstanding  444   446   448   449   451  1%
Stock-based awards outstanding  17   18   17   16   15  (14%)
Stock-based awards outstanding -- % of common shares outstanding  3.8%  4.0%  3.8%  3.6%  3.2% N/A 
             
Results of Operations            
Worldwide (WW) net sales $9,519  $7,131  $6,566  $7,560  $12,948  36%
WW net sales -- Y/Y growth, excluding F/X  37%  42%  42%  40%  37% N/A 
WW net sales -- TTM $24,509  $26,750  $28,664  $30,776  $34,204  40%
WW net sales -- TTM Y/Y growth, excluding F/X  29%  33%  38%  40%  40% N/A 
             
Operating income (3) $476  $394  $270  $268  $474  (0%)
Operating income -- Y/Y growth, excluding F/X  63%  56%  77%  13%  3% N/A 
Operating margin -- % of WW net sales  5.0%  5.5%  4.1%  3.5%  3.7% N/A 
Operating income -- TTM (3) $1,129  $1,279  $1,391  $1,408  $1,406  25%
Operating income -- TTM Y/Y growth, excluding F/X  39%  44%  65%  50%  27% N/A 
Operating margin -- TTM % of WW net sales  4.6%  4.8%  4.9%  4.6%  4.1% N/A 
             
Net income (3) $384  $299  $207  $231  $416  8%
Net income per diluted share $0.85  $0.66  $0.45  $0.51  $0.91  6%
Net income -- TTM (3) $902  $1,024  $1,088  $1,120  $1,152  28%
Net income per diluted share -- TTM $2.04  $2.30  $2.42  $2.47  $2.53  24%
             
Segments            
North America Segment:            
Net sales $4,956  $3,780  $3,590  $4,126  $7,211  45%
Net sales -- Y/Y growth, excluding F/X  36%  46%  46%  45%  45% N/A 
Net sales -- TTM $12,828  $14,030  $15,168  $16,452  $18,707  46%
Operating income $278  $273  $200  $186  $295  6%
Operating margin -- % of North America net sales  5.6%  7.2%  5.6%  4.5%  4.1% N/A 
Operating income -- TTM $709  $832  $907  $937  $955  35%
Operating income -- TTM Y/Y growth, excluding F/X  59%  79%  84%  67%  35% N/A 
Operating margin -- TTM % of North America net sales  5.5%  5.9%  6.0%  5.7%  5.1% N/A 
             
International Segment:            
Net sales $4,563  $3,351  $2,976  $3,434  $5,737  26%
Net sales -- Y/Y growth, excluding F/X  37%  37%  38%  35%  29% N/A 
Net sales -- TTM $11,681  $12,720  $13,496  $14,324  $15,497  33%
Net sales -- TTM % of WW net sales  48%  48%  47%  47%  45% N/A 
Operating income $319  $234  $206  $215  $327  3%
Operating margin -- % of International net sales  7.0%  7.0%  6.9%  6.2%  5.7% N/A 
Operating income -- TTM $863  $925  $952  $973  $981  14%
Operating income -- TTM Y/Y growth, excluding F/X  41%  33%  28%  23%  20% N/A 
Operating margin -- TTM % of International net sales  7.4%  7.3%  7.1%  6.8%  6.3% N/A 
             
Consolidated Segments:            
Operating expenses (4) $8,922  $6,624  $6,160  $7,159  $12,326  38%
Operating expenses -- TTM (4) $22,937  $24,993  $26,805  $28,866  $32,268  40%
Operating income $597  $507  $406  $401  $622  4%

Operating margin -- % of Consolidated sales

  6.3%  7.1%  6.2%  5.3%  4.8% N/A 
Operating income -- TTM $1,572  $1,757  $1,859  $1,910  $1,936  23%
Operating income -- TTM Y/Y growth, excluding F/X  48%  51%  51%  42%  25% N/A 

Operating margin -- TTM % of Consolidated net sales

  6.4%  6.6%  6.5%  6.2%  5.7% N/A 
             
             
AMAZON.COM, INC.
Supplemental Financial Information and Business Metrics
(in millions, except inventory turnover, accounts payable days and employee data)
(unaudited)
             
            Y/Y %
  Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Change
Supplemental            
Supplemental North America Segment Net Sales:            
Media $2,099  $1,597  $1,324  $1,591  $2,370  13%
Media -- Y/Y growth, excluding F/X  19%  22%  15%  12%  13% N/A 
Media -- TTM $5,964  $6,255  $6,432  $6,610  $6,881  15%
Electronics and other general merchandise $2,662  $2,024  $2,090  $2,326  $4,558  71%
Electronics and other general merchandise -- Y/Y growth, excluding F/X  54%  73%  76%  80%  71% N/A 
Electronics and other general merchandise -- TTM $6,314  $7,166  $8,069  $9,103  $10,998  74%
Electronics and other general merchandise -- TTM % of North America net sales  49%  51%  53%  55%  59% N/A 
Other $195  $159  $176  $209  $283  45%
Other -- TTM $550  $608  $668  $739  $828  50%
             
Supplemental International Segment Net Sales:            
Media $2,580  $1,833  $1,550  $1,759  $2,865  11%
Media -- Y/Y growth, excluding F/X  26%  23%  21%  18%  13% N/A 
Media -- TTM $6,810  $7,225  $7,480  $7,723  $8,007  18%
Electronics and other general merchandise $1,947  $1,489  $1,399  $1,644  $2,834  46%
Electronics and other general merchandise -- Y/Y growth, excluding F/X  56%  61%  63%  60%  50% N/A 
Electronics and other general merchandise -- TTM $4,768  $5,382  $5,899  $6,478  $7,365  54%
Electronics and other general merchandise -- TTM % of International net sales  41%  42%  44%  45%  48% N/A 
Other $36  $29  $27  $31  $38  6%
Other -- TTM $103  $114  $117  $123  $125  22%
             
Supplemental Worldwide Net Sales:            
Media $4,679  $3,430  $2,874  $3,350  $5,235  12%
Media -- Y/Y growth, excluding F/X  23%  22%  18%  15%  13% N/A 
Media -- TTM $12,774  $13,480  $13,912  $14,333  $14,888  17%
Electronics and other general merchandise $4,609  $3,513  $3,489  $3,970  $7,392  60%
Electronics and other general merchandise -- Y/Y growth, excluding F/X  54%  68%  70%  71%  62% N/A 
Electronics and other general merchandise -- TTM $11,082  $12,548  $13,968  $15,581  $18,363  66%
Electronics and other general merchandise -- TTM % of WW net sales  45%  47%  49%  51%  54% N/A 
Other $231  $188  $203  $240  $321  39%
Other -- TTM $653  $722  $785  $862  $953  46%
             
Balance Sheet            
Cash and marketable securities (5) $6,672  $5,381  $5,419  $6,123  $8,919  34%
Inventory, net -- ending $2,171  $1,820  $1,940  $2,515  $3,202  48%
Inventory turnover, average -- TTM  12.2   12.6   12.5   11.8   11.4  (7%)
Fixed assets, net $1,290  $1,436  $1,704  $2,099  $2,414  87%
             
Accounts payable -- ending $5,605  $3,619  $3,545  $4,614  $8,051  44%
Accounts payable days -- ending  68   59   65   73   72  5%
             
Other            
WW shipping revenue $341  $248  $239  $270  $437  28%
WW shipping costs $696  $518  $487  $576  $999  44%
WW net shipping costs $355  $270  $248  $306  $562  58%
WW net shipping costs -- % of WW net sales  3.7%  3.8%  3.8%  4.0%  4.3% N/A 
             
             
Employees (full-time and part-time; excludes contractors & temporary personnel)  24,300   26,100   28,300   31,200   33,700  39%
             
             
(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) Q2 2009 was negatively impacted by a $51 million legal settlement.

(4) Represents cost of sales, fulfillment, marketing, technology and content, and general and administrative operating expenses, excluding stock-based compensation.

(5) Includes restricted cash, classified within "Other Assets" on our consolidated balance sheet, of: $306 million in Q4 2009, $318 million Q1 2010, $311 million in Q2 2010, $238 million in Q3 2010 and $157 million in Q4 2010.

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.com domains worldwide - such as www.amazon.com, www.amazon.co.uk, www.amazon.de, www.amazon.co.jp, www.amazon.fr, www.amazon.ca, www.amazon.cn and www.amazon.it, as well as Amazon.com-owned items sold through non-Amazon.com domains. Units sold do not include units associated with certain of our acquisitions or Amazon.com gift certificates.

 

 

SOURCE: Amazon.com, Inc.

Amazon.com Investor Relations
Rob Eldridge, 206-266-2171
www.amazon.com/ir
or
Amazon.com Public Relations
Mary Osako, 206-266-7180