Amazon.com Announces First Quarter Sales up 22% to $16.07 Billion

  Amazon.com Announces First Quarter Sales up 22% to $16.07 Billion

Business Wire

SEATTLE -- April 25, 2013

Amazon.com, Inc. (NASDAQ:AMZN) today announced financial results for its first
quarter ended March 31, 2013.

Operating cash flow increased 39% to $4.25 billion for the trailing twelve
months, compared with $3.05 billion for the trailing twelve months ended March
31, 2012. Free cash flowdecreased 85% to $177 million for the trailing twelve
months, compared with $1.15 billion for the trailing twelve months ended March
31, 2012. Free cash flow for the trailing twelve months ended March 31, 2013
includes fourth quarter 2012 cash outflows for purchases of corporate office
space and property in Seattle, Washington, of $1.4 billion.

Common shares outstanding plus shares underlying stock-based awards totaled
471 million on March 31, 2013, compared with 464 million one year ago.

Net sales increased 22% to $16.07 billion in the first quarter, compared with
$13.18 billion in first quarter 2012. Excluding the $302 million unfavorable
impact from year-over-year changes in foreign exchange rates throughout the
quarter, net sales grew 24% compared with first quarter 2012.

Operating income decreased 6% to $181 million in the first quarter, compared
with $192 million in first quarter 2012. The unfavorable impact from
year-over-year changes in foreign exchange rates throughout the quarter on
operating income was $12 million.

Net income decreased 37% to $82 million in the first quarter, or $0.18 per
diluted share, compared with $130 million, or $0.28 per diluted share, in
first quarter 2012.

“Amazon Studios is working on a new way to greenlight TV shows. The pilots are
out in the open where everyone can have a say,” said Jeff Bezos, founder and
CEO of Amazon.com. “I have my personal picks and so do members of the Amazon
Studios team, but the exciting thing about our approach is that our opinions
don’t matter. Our customers will determine what goes into full-season
production. We hope Amazon Originals can become yet another way for us to
create value for Prime members.”

Highlights

  *Amazon.com expanded selection for Prime Instant Video, announcing new
    licensing agreements with A+E Networks, CBS Corporation, FX, PBS
    Distribution and Scripps Networks Interactive, bringing exclusive access
    to popular television series such as Downton Abbey, Justified and Under
    the Dome as well as shows from HGTV, DIY Network, Food Network, Cooking
    Channel and Travel Channel. Prime Instant Video now includes more than
    38,000 movies and TV episodes that are available for Prime members to
    watch at no additional charge.
  *Amazon Studios, the original film and series production arm of Amazon.com,
    debuted 14 original comedy and kids pilots. The pilots, which feature
    stars such as John Goodman, Jeffrey Tambor and Bebe Neuwirth, are
    available exclusively at www.amazonoriginals.com and on the Amazon Instant
    Video app for Kindle Fire HD, Kindle Fire, iPad, iPhone, iPod touch, Roku,
    Xbox 360, PlayStation 3, Wii and Wii U, as well as hundreds of other
    connected devices. Viewer feedback will help determine which pilots Amazon
    Studios will produce into full series.
  *Amazon expanded the popular Kindle Fire feature “X-Ray for Movies” to TV
    shows, bringing the power of IMDb directly to the most popular TV shows on
    Kindle Fire. With a single tap viewers can discover the names of actors
    and what they've been in, without even leaving the TV show.
  *Kindle Owners’ Lending Library has grown to over 300,000 books available
    to borrow for free as frequently as a book a month, including many titles
    exclusive to Amazon.
  *Amazon announced the launch of the Amazon MP3 store optimized specifically
    for Safari browser. For the first time ever, iPhone and iPod touch users
    can discover and buy digital music from Amazon’s 22 million song catalog.
    Amazon also announced its Cloud Player app for iPad and iPad mini,
    enabling customers to play or download music stored in Cloud Player to
    their device, play music that is already stored on their device, and
    manage or create playlists.
  *Amazon announced it has extended its popular AutoRip services to vinyl
    records. AutoRip provides customers with free MP3 versions of CDs and
    vinyl records they purchase from Amazon. Additionally, customers who have
    purchased AutoRip CDs or vinyl records at any time since Amazon first
    opened its Music Store in 1998 will find MP3 versions of those albums in
    their Cloud Player libraries – also automatically for free.
  *Amazon announced the launch of Kindle Fire HD 8.9” — the large-screen
    version of its best-selling tablet —for the U.K., Germany, France, Italy,
    Spain and Japan. With the expansion of Kindle Fire HD 8.9” to Europe and
    Japan, Amazon also announced a lower price on Kindle Fire HD 8.9” in the
    U.S., with the Wi-Fi version starting at $269 and the 4G version starting
    at $399.
  *Amazon Publishing, the publishing arm of Amazon.com, announced that it
    will start paying authors their royalties monthly, 60 days in arrears —
    allowing authors to receive payment more frequently than the twice-a-year
    industry standard.
  *Amazon acquired Goodreads, a leading site for readers and book
    recommendations that helps people find and share books they love.
    Goodreads members can discover new books by seeing what their friends are
    reading or by using the Goodreads Book Recommendation Engine; share
    ratings and recommendations; track what they have read, and list what they
    want to read.
  *Amazon Web Services (AWS) announced the launch of Amazon Redshift, a fast
    and powerful, fully managed, petabyte-scale data warehouse service in the
    cloud for a fraction of the cost of a traditional data warehouse.
  *AWS launched AWS OpsWorks, an application management solution for the
    complete lifecycle of complex applications, including resource
    provisioning, configuration management, deployment, monitoring, and access
    control.
  *AWS announced Amazon Elastic Transcoder, a highly scalable service for
    transcoding video files between different digital media formats. Amazon
    Elastic Transcoder manages all aspects of the transcoding process
    transparently and automatically, providing scalability and performance by
    leveraging AWS services.
  *AWS announced AWS CloudHSM, a new service enabling customers to increase
    data security and meet compliance requirements by using dedicated Hardware
    Security Module (HSM) appliances within the AWS Cloud. The CloudHSM
    service allows customers to securely generate, store and manage
    cryptographic keys used for data encryption in a way that keys are
    accessible only by the customer.
  *AWS has lowered prices 31 times since it launched in 2006, including 7
    price reductions so far in 2013.

Financial Guidance

The following forward-looking statements reflect Amazon.com’s expectations as
of April 25, 2013. 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.

Second Quarter 2013 Guidance

  *Net sales are expected to be between $14.5 billion and $16.2 billion, or
    to grow between 13% and 26% compared with second quarter 2012.
  *Operating income (loss) is expected to be between $(340) million and $10
    million, compared to $107 million in the comparable prior year period.
  *This guidance includes approximately $340 million for stock-based
    compensation and amortization of intangible assets, and it assumes, among
    other things, that no additional business acquisitions, investments, or
    legal settlements are concluded and that there are no further revisions to
    stock-based compensation estimates.

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

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

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

About Amazon.com

Amazon.com, Inc. (NASDAQ: AMZN), a Fortune 500 company based in Seattle,
opened on the World Wide Web in July 1995 and today offers Earth’s Biggest
Selection. Amazon.com, Inc. seeks to be Earth’s most customer-centric company,
where customers can find and discover anything they might want to buy online,
and endeavors to offer its customers the lowest possible prices. Amazon.com
and other sellers offer millions of unique new, refurbished and used items in
categories such as Books; Movies, Music & Games; Digital Downloads;
Electronics & Computers; Home & Garden; Toys, Kids & Baby; Grocery; Apparel,
Shoes & Jewelry; Health & Beauty; Sports & Outdoors; and Tools, Auto &
Industrial. Amazon Web Services provides Amazon’s developer customers with
access to in-the-cloud infrastructure services based on Amazon’s own back-end
technology platform, which developers can use to enable virtually any type of
business. Kindle Paperwhite is the most-advanced e-reader ever constructed
with 62% more pixels and 25% increased contrast, a patented built-in front
light for reading in all lighting conditions, extra-long battery life, and a
thin and light design. The new latest generation Kindle, the lightest and
smallest Kindle, now features new, improved fonts and faster page turns.
Kindle Fire HD features a stunning custom high-definition display, exclusive
Dolby audio with dual stereo speakers, high-end, laptop-grade Wi-Fi with
dual-band support, dual-antennas and MIMO for faster streaming and downloads,
enough storage for HD content, and the latest generation processor and
graphics engine—and it is available in two display sizes—7” and 8.9”. The
large-screen Kindle Fire HD is also available with 4G wireless, and comes with
a groundbreaking $49.99 introductory 4G LTE data package. The all-new Kindle
Fire features a 20% faster processor, 40% faster performance, twice the
memory, and longer battery life.

Amazon and its affiliates operate websites, including www.amazon.com,
www.amazon.co.uk, www.amazon.de, www.amazon.co.jp, www.amazon.fr,
www.amazon.ca, www.amazon.cn, www.amazon.it, www.amazon.es and
www.amazon.com.br. 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
                             March 31,                 March 31,
                             2013         2012         2013         2012
                                                                    
CASH AND CASH EQUIVALENTS,   $ 8,084      $ 5,269      $ 2,288      $ 2,641
BEGINNING OF PERIOD
                                                                    
OPERATING ACTIVITIES:
Net income (loss)              82           130          (87    )     561
Adjustments to reconcile
net income (loss) to net
cash from operating
activities:
Depreciation of property
and equipment, including
internal-use software and      700          457          2,402        1,338
website development, and
other amortization
Stock-based compensation       229          160          901          605
Other operating expense        31           46           139          168
(income), net
Losses (gains) on sales of     -            (2     )     (7     )     (8     )
marketable securities, net
Other expense (income),        68           15           306          (78    )
net
Deferred income taxes          (80    )     (38    )     (307   )     83
Excess tax benefits from       -            (40    )     (390   )     (56    )
stock-based compensation
Changes in operating
assets and liabilities:
Inventories                    535          747          (1,211 )     (1,374 )
Accounts receivable, net       729          746          (877   )     (479   )
and other
Accounts payable               (4,187 )     (4,258 )     2,141        1,388
Accrued expenses and other     (703   )     (529   )     864          721
Additions to unearned          684          397          2,083        1,252
revenue
Amortization of previously    (460   )    (269   )    (1,712 )    (1,070 )
unearned revenue
Net cash provided by (used     (2,372 )     (2,438 )     4,245        3,051
in) operating activities
                                                                    
INVESTING ACTIVITIES:
Purchases of property and
equipment, including           (670   )     (386   )     (4,068 )     (1,899 )
internal-use software and
website development
Acquisitions, net of cash      (103   )     (50    )     (798   )     (615   )
acquired, and other
Sales and maturities of
marketable securities and      599          1,738        3,098        6,641
other investments
Purchases of marketable
securities and other          (776   )    (852   )    (3,227 )    (5,997 )
investments
Net cash provided by (used     (950   )     450          (4,995 )     (1,870 )
in) investing activities
                                                                    
FINANCING ACTIVITIES:
Excess tax benefits from       -            40           390          56
stock-based compensation
Common stock repurchased       -            (960   )     -            (1,237 )
Proceeds from long-term        25           68           3,319        154
debt and other
Repayments of long-term
debt, capital lease, and      (182   )    (153   )    (603   )    (483   )
finance lease obligations
Net cash provided by (used     (157   )     (1,005 )     3,106        (1,510 )
in) financing activities
                                                                    
Foreign-currency effect on    (124   )    12         (163   )    (24    )
cash and cash equivalents
Net increase (decrease) in     (3,603 )     (2,981 )     2,193        (353   )
cash and cash equivalents
                                                                    
CASH AND CASH EQUIVALENTS,   $ 4,481     $ 2,288     $ 4,481     $ 2,288  
END OF PERIOD
                                                                    
SUPPLEMENTAL CASH FLOW
INFORMATION:
Cash paid for interest on    $ 13         $ 6          $ 37         $ 17
long-term debt
Cash paid for income taxes     86           19           179          45
(net of refunds)
Property and equipment
acquired under capital         340          149          993          721
leases
Property and equipment
acquired under                 150          17           163          207
build-to-suit leases


AMAZON.COM, INC.
Consolidated Statements of Operations
(in millions, except per share data)
(unaudited)
                                                                 
                                                       Three Months Ended
                                                       March 31,
                                                       2013         2012
                                                                    
Net product sales                                      $ 13,271     $ 11,249
Net services sales                                      2,799      1,936  
Total net sales                                          16,070       13,185
                                                                    
Operating expenses (1):
Cost of sales                                            11,801       10,027
Fulfillment                                              1,796        1,295
Marketing                                                632          480
Technology and content                                   1,383        945
General and administrative                               246          200
Other operating expense (income), net                   31         46     
Total operating expenses                                15,889     12,993 
                                                                    
Income from operations                                   181          192
                                                                    
Interest income                                          10           12
Interest expense                                         (33    )     (21    )
Other income (expense), net                             (77    )    (99    )
Total non-operating income (expense)                    (100   )    (108   )
                                                                    
Income before income taxes                               81           84
                                                                    
Benefit (provision) for income taxes                     18           (43    )
Equity-method investment activity, net of tax           (17    )    89     
Net income                                             $ 82        $ 130    
                                                                    
Basic earnings per share                               $ 0.18      $ 0.29   
                                                                    
Diluted earnings per share                             $ 0.18      $ 0.28   
                                                                    
                                                                    
Weighted average shares used in computation of
earnings per share:
Basic                                                   455        453    
Diluted                                                 463        460    

(1) Includes stock-based compensation as follows:
Fulfillment                                            $ 61         $ 37
Marketing                                                16           12
Technology and content                                   120          85
General and administrative                               32           26

                                                                    
AMAZON.COM, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in millions)
(unaudited)
                                                                       
                                                            Three Months Ended
                                                            March 31,
                                                            2013       2012
                                                                       
Net income                                                  $  82      $ 130
                                                                       
Other comprehensive income (loss):
Foreign currency translation adjustments, net of tax of        (78 )     137
$(9) and $(38)
Net change in unrealized gains on available-for-sale
securities:
Unrealized gains (losses), net of tax of $1 and $(3)           (2  )     7
Reclassification adjustment for losses (gains) included
in "Other income (expense), net," net of tax effect of $0     -       (2  )
and $1
Net unrealized gains (losses) on available-for-sale           (2  )    5   
securities
Total other comprehensive income (loss)                       (80 )    142 
                                                                       
Comprehensive income                                        $  2      $ 272 

                         
AMAZON.COM, INC.
Segment Information
(in millions)
(unaudited)
                                                                           
                              Three Months Ended
                              March 31,
                              2013                     2012
North America
Net sales                     $    9,391               $    7,427
Segment operating                 8,934                  7,078     
expenses (1)
Segment operating income      $    457                $    349       
                                                                           
International
Net sales                     $    6,679               $    5,758
Segment operating                 6,695                  5,709     
expenses (1)
Segment operating income      $    (16       )         $    49        
(loss)
                                                                           
Consolidated
Net sales                     $    16,070              $    13,185
Segment operating                 15,629                 12,787    
expenses (1)
Segment operating income           441                      398
Stock-based compensation           (229      )              (160      )
Other operating income            (31       )             (46       )
(expense), net
Income from operations             181                      192
Total non-operating                (100      )              (108      )
income (expense)
Benefit (provision) for            18                       (43       )
income taxes
Equity-method investment          (17       )             89        
activity, net of tax
Net income                    $    82                 $    130       
                                                                           
Segment Highlights:
Y/Y net sales growth:
North America                      26             %         36             %
International                      16                       31
Consolidated                       22                       34
Y/Y segment operating
income growth (decline):
North America                      31             %         20             %
International                      (133      )              (72       )
Consolidated                       11                       (15       )
Net sales mix:
North America                      58             %         56             %
International                     42                     44        
                                  100           %        100           %

(1) Represents operating expenses, excluding stock-based compensation and
"Other operating expense (income), net," which are not allocated to segments.

                                 
AMAZON.COM, INC.
Supplemental Net Sales Information
(in millions)
(unaudited)
                                                                          
                                       Three Months Ended
                                       March 31,
                                       2013                2012
North America
Media                                  $    2,513          $    2,197
Electronics and other general               6,128               4,772
merchandise
Other (1)                                  750                458
Total North America                    $    9,391          $    7,427
                                                                          
International
Media                                  $    2,545          $    2,513
Electronics and other general               4,086               3,203
merchandise
Other (1)                                  48                 42
Total International                    $    6,679          $    5,758
                                                                          
Consolidated
Media                                  $    5,058          $    4,710
Electronics and other general               10,214              7,975
merchandise
Other (1)                                  798                500
Total consolidated                     $    16,070         $    13,185
                                                                          
Y/Y Net Sales Growth:
North America:
Media                                       14        %         17        %
Electronics and other general               28                  44
merchandise
Other                                       64                  66
Total North America                         26                  36
                                                                          
International:
Media                                       1         %         21        %
Electronics and other general               28                  40
merchandise
Other                                       14                  24
Total International                         16                  31
                                                                          
Consolidated:
Media                                       7         %         19        %
Electronics and other general               28                  43
merchandise
Other                                       59                  61
Total consolidated                          22                  34
                                                                          
Y/Y Net Sales Growth Excluding
Effect of Exchange Rates:
International:
Media                                       7         %         22        %
Electronics and other general               32                  42
merchandise
Other                                       18                  26
Total International                         21                  32
                                                                          
Consolidated:
Media                                       10        %         19        %
Electronics and other general               30                  43
merchandise
Other                                       60                  61
Total consolidated                          24                  34
                                                                          
Consolidated Net Sales Mix:
Media                                       31        %         36        %
Electronics and other general               64                  60
merchandise
Other                                      5                  4
                                           100       %        100       %

(1) Includes sales from non-retail activities, such as AWS in the North
America segment, advertising services, and our co-branded credit card
agreements in both segments.


AMAZON.COM, INC.
Consolidated Balance Sheets
(in millions, except per share data)
                                                        
                                             March 31,     December 31,
                                             2013          2012
ASSETS                                       (unaudited)
Current assets:
Cash and cash equivalents                    $  4,481      $  8,084
Marketable securities                           3,414         3,364
Inventories                                     5,395         6,031
Accounts receivable, net and other              2,516         3,364
Deferred tax assets                            507         453     
Total current assets                            16,313        21,296
Property and equipment, net                     7,674         7,060
Deferred tax assets                             123           123
Goodwill                                        2,535         2,552
Other assets                                   1,732       1,524   
Total assets                                 $  28,377    $  32,555  
                                                           
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable                             $  8,916      $  13,318
Accrued expenses and other                     5,416       5,684   
Total current liabilities                       14,332        19,002
Long-term debt                                  3,040         3,084
Other long-term liabilities                     2,573         2,277
                                                           
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 — 479 and 478
Outstanding shares — 455 and 454                5             5
Treasury stock, at cost                         (1,837 )      (1,837  )
Additional paid-in capital                      8,585         8,347
Accumulated other comprehensive loss            (319   )      (239    )
Retained earnings                              1,998       1,916   
Total stockholders' equity                     8,432       8,192   
Total liabilities and stockholders' equity   $  28,377    $  32,555  


AMAZON.COM, INC.
Supplemental Financial Information and Business Metrics
(in millions, except per share data)
(unaudited)

                                                                                Y/Y %
                Q1 2012      Q2 2012      Q3 2012      Q4 2012      Q1 2013      Change
Cash Flows
and Shares
Operating
cash flow --
trailing        $ 3,051       $ 3,222       $ 3,368       $ 4,180       $ 4,245       39   %
twelve months
(TTM)
Purchases of
property and
equipment
(incl.
internal-use    $ 1,899       $ 2,123       $ 2,310       $ 3,785       $ 4,068       114  %
software &
website
development)
-- TTM
Free cash
flow
(operating
cash flow
less            $ 1,152       $ 1,099       $ 1,058       $ 395         $ 177         (85  %)
purchases of
property and
equipment) --
TTM
Free cash
flow -- TTM       (39    %)     (40    %)     (31    %)     (81    %)     (85    %)   N/A
Y/Y growth
(decline)
Invested        $ 10,006      $ 10,250      $ 10,392      $ 11,181      $ 12,019      20   %
capital (1)
Return on
invested          12     %      11     %      10     %      4      %      1      %    N/A
capital (2)
                                                                                      
Common shares
and
stock-based       464           468           469           470           471         2    %
awards
outstanding
Common shares     450           452           453           454           455         1    %
outstanding
Stock-based
awards            13            16            16            16            16          17   %
outstanding
Stock-based
awards
outstanding       2.9    %      3.6    %      3.6    %      3.5    %      3.4    %    N/A
-- % of
common shares
outstanding
                                                                                      
Results of
Operations
Worldwide
(WW) net        $ 13,185      $ 12,834      $ 13,806      $ 21,268      $ 16,070      22   %
sales
WW net sales
-- Y/Y            34     %      32     %      30     %      23     %      24     %    N/A
growth,
excluding F/X
WW net sales    $ 51,404      $ 54,325      $ 57,256      $ 61,093      $ 63,978      24   %
-- TTM
WW net sales
-- TTM Y/Y        37     %      35     %      33     %      29     %      27     %    N/A
growth,
excluding F/X
                                                                                      
Operating       $ 192         $ 107         $ (28    )    $ 405         $ 181         (6   %)
income (loss)
Operating
income -- Y/Y
growth            (38    %)     (34    %)     (137   %)     59     %      1      %    N/A
(decline),
excluding F/X
Operating
margin -- %       1.5    %      0.8    %      (0.2   %)     1.9    %      1.1    %    N/A
of WW net
sales
Operating       $ 732         $ 637         $ 531         $ 676         $ 665         (9   %)
income -- TTM
Operating
income -- TTM
Y/Y growth        (50    %)     (50    %)     (48    %)     (15    %)     (6     %)   N/A
(decline),
excluding F/X
Operating
margin -- TTM     1.4    %      1.2    %      0.9    %      1.1    %      1.0    %    N/A
% of WW net
sales
                                                                                      
Net income      $ 130         $ 7           $ (274   )    $ 97          $ 82          (37  %)
(loss)
Net income
(loss) per      $ 0.28        $ 0.01        $ (0.60  )    $ 0.21        $ 0.18        (37  %)
diluted share
Net income      $ 561         $ 377         $ 40          $ (39    )    $ (87    )    (116 %)
(loss) -- TTM
Net income
(loss) per      $ 1.22        $ 0.82        $ 0.09        $ (0.09  )    $ (0.19  )    (116 %)
diluted share
-- TTM
                                                                                      
Segments
North America
Segment:
Net sales       $ 7,427       $ 7,326       $ 7,884       $ 12,175      $ 9,391       26   %
Net sales --
Y/Y growth,       36     %      36     %      33     %      23     %      26     %    N/A
excluding F/X
Net sales --    $ 28,667      $ 30,587      $ 32,540      $ 34,813      $ 36,777      28   %
TTM
Operating       $ 349         $ 344         $ 291         $ 608         $ 457         31   %
income
Operating
margin -- %
of North          4.7    %      4.7    %      3.7    %      5.0    %      4.9    %    N/A
America net
sales
Operating       $ 991         $ 1,120       $ 1,268       $ 1,592       $ 1,700       72   %
income -- TTM
Operating
income -- TTM     2      %      14     %      34     %      71     %      72     %    N/A
Y/Y growth,
excluding F/X
Operating
margin -- TTM
% of North        3.5    %      3.7    %      3.9    %      4.6    %      4.6    %    N/A
America net
sales
                                                                                      
International
Segment:
Net sales       $ 5,758       $ 5,508       $ 5,922       $ 9,093       $ 6,679       16   %
Net sales --
Y/Y growth,       32     %      28     %      27     %      23     %      21     %    N/A
excluding F/X
Net sales --    $ 22,737      $ 23,738      $ 24,716      $ 26,280      $ 27,201      20   %
TTM
Net sales --
TTM % of WW       44     %      44     %      43     %      43     %      43     %    N/A
net sales
Operating       $ 49          $ 16          $ (59    )    $ 70          $ (16    )    (133 %)
income (loss)
Operating
margin -- %
of                0.9    %      0.3    %      (1.0   %)     0.8    %      (0.2   %)   N/A
International
net sales
Operating       $ 515         $ 359         $ 183         $ 76          $ 11          (98  %)
income -- TTM
Operating
income -- TTM
Y/Y growth        (49    %)     (57    %)     (68    %)     (77    %)     (83    %)   N/A
(decline),
excluding F/X
Operating
margin -- TTM
% of              2.3    %      1.5    %      0.7    %      0.3    %      0.0    %    N/A
International
net sales
                                                                                      
Consolidated
Segments:
Operating       $ 12,787      $ 12,474      $ 13,574      $ 20,590      $ 15,629      22   %
expenses (3)
Operating
expenses --     $ 49,899      $ 52,846      $ 55,805      $ 59,425      $ 62,267      25   %
TTM (3)
Operating       $ 398         $ 360         $ 232         $ 678         $ 441         11   %
income
Operating
margin -- %
of                3.0    %      2.8    %      1.7    %      3.2    %      2.7    %    N/A
Consolidated
sales
Operating       $ 1,505       $ 1,480       $ 1,451       $ 1,668       $ 1,711       14   %
income -- TTM
Operating
income -- TTM
Y/Y growth        (22    %)     (21    %)     (15    %)     7      %      15     %    N/A
(decline),
excluding F/X
Operating
margin -- TTM
% of            2.9    %    2.7    %    2.5    %    2.7    %    2.7    %   N/A  
Consolidated
net sales
                                                                                      
AMAZON.COM, INC.
Supplemental Financial Information and Business Metrics
(in millions, except inventory turnover, accounts payable days and employee data)
(unaudited)

                                                                                      Y/Y %
                Q1 2012      Q2 2012      Q3 2012      Q4 2012      Q1 2013      Change
Supplemental
Supplemental
North America
Segment Net
Sales:
Media           $ 2,197       $ 1,874       $ 2,215       $ 2,903       $ 2,513       14   %
Media -- Y/Y
growth,           17     %      18     %      15     %      13     %      14     %    N/A
excluding F/X
Media -- TTM    $ 8,270       $ 8,559       $ 8,847       $ 9,189       $ 9,506       15   %
Electronics
and other       $ 4,772       $ 4,937       $ 5,061       $ 8,503       $ 6,128       28   %
general
merchandise
Electronics
and other
general
merchandise       44     %      41     %      39     %      24     %      28     %    N/A
-- Y/Y
growth,
excluding F/X
Electronics
and other
general         $ 18,784      $ 20,226      $ 21,652      $ 23,273      $ 24,629      31   %
merchandise
-- TTM
Electronics
and other
general
merchandise       66     %      66     %      67     %      67     %      67     %    N/A
-- TTM % of
North America
net sales
Other           $ 458         $ 515         $ 608         $ 769         $ 750         64   %
Other -- TTM    $ 1,613       $ 1,802       $ 2,041       $ 2,351       $ 2,642       64   %
                                                                                      
Supplemental
International
Segment Net
Sales:
Media           $ 2,513       $ 2,245       $ 2,385       $ 3,611       $ 2,545       1    %
Media -- Y/Y
growth,           22     %      12     %      12     %      7      %      7      %    N/A
excluding F/X
Media -- TTM    $ 10,261      $ 10,431      $ 10,590      $ 10,753      $ 10,785      5    %
Electronics
and other       $ 3,203       $ 3,224       $ 3,497       $ 5,431       $ 4,086       28   %
general
merchandise
Electronics
and other
general
merchandise       42     %      42     %      39     %      37     %      32     %    N/A
-- Y/Y
growth,
excluding F/X
Electronics
and other
general         $ 12,314      $ 13,139      $ 13,956      $ 15,355      $ 16,238      32   %
merchandise
-- TTM
Electronics
and other
general
merchandise       54     %      55     %      56     %      58     %      60     %    N/A
-- TTM % of
International
net sales
Other           $ 42          $ 39          $ 40          $ 51          $ 48          14   %
Other -- TTM    $ 162         $ 168         $ 170         $ 172         $ 178         9    %
                                                                                      
Supplemental
Worldwide Net
Sales:
Media           $ 4,710       $ 4,119       $ 4,600       $ 6,514       $ 5,058       7    %
Media -- Y/Y
growth,           19     %      15     %      14     %      10     %      10     %    N/A
excluding F/X
Media -- TTM    $ 18,531      $ 18,990      $ 19,437      $ 19,942      $ 20,291      9    %
Electronics
and other       $ 7,975       $ 8,161       $ 8,558       $ 13,934      $ 10,214      28   %
general
merchandise
Electronics
and other
general
merchandise       43     %      42     %      39     %      29     %      30     %    N/A
-- Y/Y
growth,
excluding F/X
Electronics
and other
general         $ 31,098      $ 33,365      $ 35,608      $ 38,628      $ 40,867      31   %
merchandise
-- TTM
Electronics
and other
general           60     %      61     %      62     %      63     %      64     %    N/A
merchandise
-- TTM % of
WW net sales
Other           $ 500         $ 554         $ 648         $ 820         $ 798         59   %
Other -- TTM    $ 1,775       $ 1,970       $ 2,211       $ 2,523       $ 2,820       59   %
                                                                                      
Balance Sheet
Cash and
marketable      $ 5,715       $ 4,970       $ 5,248       $ 11,448      $ 7,895       38   %
securities
Inventory,      $ 4,255       $ 4,380       $ 5,065       $ 6,031       $ 5,395       27   %
net -- ending
Inventory
turnover,         10.4          10.1          9.7           9.3           9.5         (8   %)
average --
TTM
Property and
equipment,      $ 4,653       $ 5,097       $ 5,662       $ 7,060       $ 7,674       65   %
net
                                                                                      
Accounts
payable --      $ 6,886       $ 7,072       $ 8,369       $ 13,318      $ 8,916       29   %
ending
Accounts
payable days      62            68            75            76            68          9    %
-- ending
                                                                                      
Other
WW shipping     $ 461         $ 469         $ 517         $ 832         $ 633         37   %
revenue
WW shipping     $ 1,129       $ 1,054       $ 1,153       $ 1,798       $ 1,396       24   %
costs
WW net
shipping        $ 668         $ 585         $ 636         $ 966         $ 763         14   %
costs
WW net
shipping          5.1    %      4.6    %      4.6    %      4.5    %      4.7    %    N/A
costs -- % of
WW net sales
                                                                                      
                                                                                      
Employees
(full-time
and
part-time;      65,600     69,100     81,400     88,400     91,300    39   %
excludes
contractors &
temporary
personnel)
                                                                                      
                                                                                      
(1) Average Total Assets minus Current Liabilities (excluding current portion of Long-Term
Debt) over five quarter ends.
(2) TTM Free Cash Flow divided by Invested Capital.
(3) Represents cost of sales, fulfillment, marketing, technology and content, and general and
administrative operating expenses, excluding stock-based compensation.


                               Amazon.com, Inc.

                             Certain Definitions

Customer Accounts

  *References to customers mean customer accounts, which are unique e-mail
    addresses, established either when a customer places an order or when a
    customer orders from other sellers on our websites. Customer accounts
    exclude certain customers, including customers associated with certain of
    our acquisitions, Amazon 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. Sellers are considered
    active when they have received an order from a customer during the
    preceding twelve-month period.

Registered Developers

  *References to registered developers mean cumulative registered developer
    accounts, which are established when potential developers enroll with
    Amazon Web Services and receive a developer access key.

Units

  *References to units mean physical and digital units sold (net of returns
    and cancellations) by us and sellers at Amazon domains worldwide – for
    example www.amazon.com, www.amazon.co.uk, www.amazon.de, www.amazon.co.jp,
    www.amazon.fr, www.amazon.ca, www.amazon.cn, www.amazon.it, www.amazon.es,
    www.amazon.com.br, www.diapers.com, www.shopbop.com and www.zappos.com –
    as well as Amazon-owned items sold through non-Amazon domains. Units sold
    are paid units and do not include units associated with certain
    acquisitions, rental businesses, web services or advertising businesses,
    or Amazon gift certificates.

Contact:

Amazon.com Investor Relations
Sean Boyle, 206-266-2171
www.amazon.com/ir
or
Amazon.com Public Relations
Mary Osako, 206-266-9651
www.amazon.com/pr