Amazon.com Inc. · Earnings release

AMAZON.COM ANNOUNCES THIRD QUARTER RESULTS

SEATTLE—(BUSINESS WIRE) October 31, 2024—Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its third quarter ended September 30, 2024.

•Net sales increased 11% to $158.9 billion in the third quarter, compared with $143.1 billion in third quarter 2023. Excluding the $0.2 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 11% compared with third quarter 2023.

•North America segment sales increased 9% year-over-year to $95.5 billion.

•International segment sales increased 12% year-over-year to $35.9 billion.

•AWS segment sales increased 19% year-over-year to $27.5 billion.

•Operating income increased to $17.4 billion in the third quarter, compared with $11.2 billion in third quarter 2023.

•North America segment operating income was $5.7 billion, compared with operating income of $4.3 billion in third quarter 2023.

•International segment operating income was $1.3 billion, compared with an operating loss of $0.1 billion in third quarter 2023.

•AWS segment operating income was $10.4 billion, compared with operating income of $7.0 billion in third quarter 2023.

•Net income increased to $15.3 billion in the third quarter, or $1.43 per diluted share, compared with $9.9 billion, or $0.94 per diluted share, in third quarter 2023.

•Operating cash flow increased 57% to $112.7 billion for the trailing twelve months, compared with $71.7 billion for the trailing twelve months ended September 30, 2023.

•Free cash flow increased to $47.7 billion for the trailing twelve months, compared with $21.4 billion for the trailing twelve months ended September 30, 2023.

•Free cash flow less principal repayments of finance leases and financing obligations increased to $44.9 billion for the trailing twelve months, compared with $15.9 billion for the trailing twelve months ended September 30, 2023.

•Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations increased to $46.1 billion for the trailing twelve months, compared with $20.2 billion for the trailing twelve months ended September 30, 2023.

“As we get into the holiday season, we’re excited about what we have in store for customers,” said Andy Jassy, Amazon President & CEO. “We kicked off the holiday season with our biggest-ever Prime Big Deal Days and the launch of an all-new Kindle lineup that is significantly outperforming our expectations; and there’s so much more coming, from tens of millions of deals, to our NFL Black Friday game and Election Day coverage with Brian Williams on Prime Video, to over 100 new cloud infrastructure and AI capabilities that we’ll share at AWS re:Invent the week after Thanksgiving.”

Some other highlights since the company’s last earnings announcement include that Amazon:

•Held its annual Prime Big Deal Days shopping event, with record sales, number of items sold, and Prime member participation, saving Prime members more than $1 billion with deals across its Store.

•Announced its first-ever fuel savings offer for Prime, saving U.S. members 10 cents a gallon on fuel at approximately 7,000 bp, Amoco, and ampm locations.

•Expanded its selection of brands with AllSaints, Beats x Kim, Estée Lauder, kate spade new york, and more.

•Announced plans to expand Amazon Pharmacy Same-Day Delivery of medications to nearly half the U.S. in 2025 by accelerating the roll out of new pharmacies in 20 more U.S. cities by the end of next year.

•Launched new generative AI-powered features, including:

•Rufus, a generative AI expert shopping assistant, becoming available in Canada, France, Germany, India, Italy, Spain, and the UK.

•AI Shopping Guides, which simplifies product research by using generative AI to pair information about a product category with Amazon’s wide selection, making it easier for customers to find the right product for their needs.

•Project Amelia, an AI assistant for sellers that offers tailored business insights to boost productivity and drive seller growth.

•Video generation and live image capabilities for advertisers that makes it fast and easy for brands to deliver compelling creative for customers through short, animated campaign images.

•Launched new foundation models in Amazon Bedrock and Amazon SageMaker, including AI21 Labs’ Jamba 1.5 family, Anthropic’s upgraded Claude 3.5 Sonnet, Meta’s Llama 3.2, Mistral Large 2, and multiple Stability AI models.

•Launched new memory-optimized, compute-optimized, and general purpose Amazon EC2 instances based on AWS’s latest generation Graviton4 processor, which delivers 75% more memory bandwidth and 30% better compute performance than the previous generation Graviton chips.

•Launched Oracle Database@AWS for customers to easily and quickly migrate Oracle workloads to dedicated infrastructure on AWS with minimal to no database or application changes.

•Entered a strategic collaboration with Databricks to accelerate the development of custom models built with Databricks Mosaic AI on AWS, and for Databricks to leverage AWS Trainium chips as the preferred AI chip to help customers improve price-performance when building generative AI applications.

•Signed AWS agreements with several large enterprise companies such as The Australia and New Zealand Banking Group Limited, Booking.com, Capital One, Datadog, Epic Games, Fast Retailing, Itaú Unibanco, Luma AI, National Australia Bank, Sony, T-Mobile, Toyota, and Veeva.

•Launched Season 2 of The Lord of the Rings: The Rings of Power to positive reviews from customers and critics alike, ranking as Prime Video’s most watched returning season ever by hours watched.

•Drew more than 17 million viewers to the Cowboys-Giants Thursday Night Football game, the most-streamed NFL regular season game ever.

•Added Apple TV+ to Prime Video’s collection of over 100 add-on subscription channels in the U.S.

•Announced a new Kindle lineup, including a reimagined Kindle Scribe with generative AI, the Kindle Colorsoft with a color display, and the fastest Kindle Paperwhite ever.

•Announced investments in the Delivery Service Partner program of $2.1 billion in North America to support safety programs, training, incentives, and more, as well as 25 billion yen in Japan to support last mile delivery innovation, and safety and technology for drivers.

•Announced plans to hire 250,000 people across its U.S. operations ahead of the holiday season. All seasonal employees earn at least $18 per hour and have access to comprehensive benefits like health care.

•Announced plans for AWS to invest £8 billion over five years in the UK, supporting 14,000 jobs annually.

•Removed plastic air pillows from all delivery packaging at fulfillment centers globally, including expanding its use of paper filler made from 100% recycled content across North America to replace plastic air pillows.

•Mobilized Disaster Relief by Amazon to support communities around the world impacted by natural disasters. In the U.S., Amazon leveraged its Disaster Relief Hub in Atlanta to support communities impacted by Hurricanes Helene and Milton with donated goods, logistics support, and technology. In Europe, Amazon mobilized its global logistics infrastructure, inventory, teams, and technology to provide rapid assistance for flooding across the region.

For additional highlights from the quarter, visit aboutamazon.com/news/company-news/amazon-earnings-q3-2024-highlights.

Financial Guidance

The following forward-looking statements reflect Amazon.com’s expectations as of October 31, 2024, 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 and geopolitical conditions and customer demand and spending (including the impact of recessionary fears), inflation, interest rates, regional labor market constraints, world events, the rate of growth of the internet, online commerce, cloud services, and new and emerging technologies, and the various factors detailed below.

Fourth Quarter 2024 Guidance

•G1Net sales are expected to be between $181.5 billion and $188.5 billion, or to grow between 7% and 11% compared with fourth quarter 2023. This guidance anticipates an unfavorable impact of approximately 10 basis points from foreign exchange rates.

•G2Operating income is expected to be between $16.0 billion and $20.0 billion, compared with $13.2 billion in fourth quarter 2023.

•This guidance assumes, among other things, that no additional business acquisitions, restructurings, or legal settlements are concluded.

Conference Call Information

A conference call will be webcast live today at 2:00 p.m. PT/5:00 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.

Forward-Looking Statements

These forward-looking statements are inherently difficult to predict. Actual results and outcomes 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 claims, litigation, government investigations, and other proceedings, fulfillment, sortation, delivery, and data center optimization, risks of inventory management, variability in demand, 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, security breaches, system interruptions, government regulation and taxation, and fraud. In addition, global economic and geopolitical conditions and additional or unforeseen circumstances, developments, or events may give rise to or amplify 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.

Additional Information

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, 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. Amazon strives to be Earth’s Most Customer-Centric Company, Earth’s Best Employer, and Earth’s Safest Place to Work. Customer reviews, 1-Click shopping, personalized recommendations, Prime, Fulfillment by Amazon, AWS, Kindle Direct Publishing, Kindle, Career Choice, Fire tablets, Fire TV, Amazon Echo, Alexa, Just Walk Out technology, Amazon Studios, and The Climate Pledge are some of the things 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

Nine Months Ended

Twelve Months Ended

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD

$

$

$

$

$

$

OPERATING ACTIVITIES:

Net income

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

Depreciation and amortization of property and equipment and capitalized content costs, operating lease assets, and other

Stock-based compensation

Non-operating expense (income), net

Deferred income taxes

Changes in operating assets and liabilities:

Inventories

Accounts receivable, net and other

Other assets

Accounts payable

Accrued expenses and other

Unearned revenue

Net cash provided by (used in) operating activities

INVESTING ACTIVITIES:

Purchases of property and equipment

Proceeds from property and equipment sales and incentives

Acquisitions, net of cash acquired, non-marketable investments, and other

Sales and maturities of marketable securities

Purchases of marketable securities

Net cash provided by (used in) investing activities

FINANCING ACTIVITIES:

Proceeds from short-term debt, and other

Repayments of short-term debt, and other

Proceeds from long-term debt

—

—

—

—

—

Repayments of long-term debt

—

Principal repayments of finance leases

Principal repayments of financing obligations

Net cash provided by (used in) financing activities

Foreign currency effect on cash, cash equivalents, and restricted cash

Net increase (decrease) in cash, cash equivalents, and restricted cash

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD

$

$

$

$

$

$

SUPPLEMENTAL CASH FLOW INFORMATION:

Cash paid for interest on debt, net of capitalized interest

$

$

$

$

$

$

Cash paid for operating leases

Cash paid for interest on finance leases

Cash paid for interest on financing obligations

Cash paid for income taxes, net of refunds

Assets acquired under operating leases

Property and equipment acquired under finance leases, net of remeasurements and modifications

Property and equipment recognized during the construction period of build-to-suit lease arrangements

Property and equipment derecognized after the construction period of build-to-suit lease arrangements, with the associated leases recognized as operating

—

—

AMAZON.COM, INC.

Consolidated Statements of Operations

(in millions, except per share data)

(unaudited)

Three Months Ended

Nine Months Ended

Net product sales

$

$

$

$

Net service sales

Total net sales

Operating expenses:

Cost of sales

Fulfillment

Technology and infrastructure

Sales and marketing

General and administrative

Other operating expense (income), net

Total operating expenses

Operating income

Interest income

Interest expense

Other income (expense), net

Total non-operating income (expense)

Income before income taxes

Provision for income taxes

Equity-method investment activity, net of tax

(4)

(3)

Net income

$

$

$

$

Basic earnings per share

$

$

$

$

Diluted earnings per share

$

$

$

$

Weighted-average shares used in computation of earnings per share:

Basic

Diluted

AMAZON.COM, INC.

Consolidated Statements of Comprehensive Income

(in millions)

(unaudited)

Three Months Ended

Nine Months Ended

Net income

$

$

$

$

Other comprehensive income (loss):

Foreign currency translation adjustments, net of tax of $36, $(45), $4, and $43

Available-for-sale debt securities:

Change in net unrealized gains (losses), net of tax of $(18), $(55), $(52), and $(282)

Less: reclassification adjustment for losses (gains) included in “Other income (expense), net,” net of tax of $0, $0, $(15), and $(1)

3

—

4

Net change

Other, net of tax of $0, $3, $0, and $1

—

(3)

—

(4)

Total other comprehensive income (loss)

Comprehensive income

$

$

$

$

AMAZON.COM, INC.

Segment Information

(in millions)

(unaudited)

Three Months Ended

Nine Months Ended

North America

Net sales

$

$

$

$

Operating expenses

Operating income

$

$

$

$

International

Net sales

$

$

$

$

Operating expenses

Operating income (loss)

$

$

$

$

AWS

Net sales

$

$

$

$

Operating expenses

Operating income

$

$

$

$

Consolidated

Net sales

$

$

$

$

Operating expenses

Operating income

Total non-operating income (expense)

Provision for income taxes

Equity-method investment activity, net of tax

(4)

(3)

Net income

$

$

$

$

Segment Highlights:

Y/Y net sales growth:

North America

%

9

%

%

%

International

9

9

AWS

Consolidated

Net sales mix:

North America

%

%

%

%

International

AWS

Consolidated

%

%

%

%

AMAZON.COM, INC.

Consolidated Balance Sheets

(in millions, except per share data)

(unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$

$

Marketable securities

Inventories

Accounts receivable, net and other

Total current assets

Property and equipment, net

Operating leases

Goodwill

Other assets

Total assets

$

$

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

$

$

Accrued expenses and other

Unearned revenue

Total current liabilities

Long-term lease liabilities

Long-term debt

Other long-term liabilities

Commitments and contingencies

Stockholders’ equity:

Preferred stock ($0.01 par value; 500 shares authorized; no shares issued or outstanding)

—

—

Common stock ($0.01 par value; 100,000 shares authorized; 10,898 and 11,026 shares issued; 10,383 and 10,511 shares outstanding)

Treasury stock, at cost

Additional paid-in capital

Accumulated other comprehensive income (loss)

Retained earnings

Total stockholders’ equity

Total liabilities and stockholders’ equity

$

$

AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions, except per share data)

(unaudited)

Y/Y %

Change

Cash Flows and Shares

Operating cash flow -- trailing twelve months (TTM)

$

$

$

$

$

$

%

Operating cash flow -- TTM Y/Y growth

%

%

%

%

%

%

N/A

Purchases of property and equipment, net of proceeds from sales and incentives -- TTM

$

$

$

$

$

$

%

Principal repayments of finance leases -- TTM

$

$

$

$

$

$

%

Principal repayments of financing obligations -- TTM

$

$

$

$

$

$

%

Equipment acquired under finance leases -- TTM (1)

$

$

$

$

$

$

%

Principal repayments of all other finance leases -- TTM (2)

$

$

$

$

$

$

%

Free cash flow -- TTM (3)

$

$

$

$

$

$

%

Free cash flow less principal repayments of finance leases and financing obligations -- TTM (4)

$

$

$

$

$

$

%

Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations -- TTM (5)

$

$

$

$

$

$

%

Common shares and stock-based awards outstanding

1

%

Common shares outstanding

2

%

Stock-based awards outstanding

%

Stock-based awards outstanding -- % of common shares outstanding

%

%

%

%

%

%

N/A

Results of Operations

Worldwide (WW) net sales

$

$

$

$

$

$

%

WW net sales -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

WW net sales -- TTM

$

$

$

$

$

$

%

WW net sales -- TTM Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Operating income

$

$

$

$

$

$

%

F/X impact -- favorable

$

$

$

$

$

$

N/A

Operating income -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Operating margin -- % of WW net sales

%

%

%

%

%

%

N/A

Operating income -- TTM

$

$

$

$

$

$

%

Operating income -- TTM Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Operating margin -- TTM % of WW net sales

%

%

%

%

%

%

N/A

Net income

$

$

$

$

$

$

%

Net income per diluted share

$

$

$

$

$

$

%

Net income -- TTM

$

$

$

$

$

$

%

Net income per diluted share -- TTM

$

$

$

$

$

$

%

______________________________

(1)For the twelve months ended September 30, 2023 and 2024, this amount relates to equipment included in “Property and equipment acquired under finance leases, net of remeasurements and modifications” of $748 million and $620 million.

(2)For the twelve months ended September 30, 2023 and 2024, this amount relates to property included in “Principal repayments of finance leases” of $5,245 million and $2,489 million.

(3)Free cash flow is cash flow from operations reduced by “Purchases of property and equipment, net of proceeds from sales and incentives.”

(4)Free cash flow less principal repayments of finance leases and financing obligations is free cash flow reduced by “Principal repayments of finance leases” and “Principal repayments of financing obligations.”

(5)Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations is free cash flow reduced by equipment acquired under finance leases, which is included in “Property and equipment acquired under finance leases, net of remeasurements and modifications,” principal repayments of all other finance lease liabilities, which is included in “Principal repayments of finance leases,” and “Principal repayments of financing obligations.”

AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions)

(unaudited)

Y/Y %

Change

Segments

North America Segment:

Net sales

$

$

$

$

$

$

9

%

Net sales -- Y/Y growth, excluding F/X

%

%

%

%

9

%

9

%

N/A

Net sales -- TTM

$

$

$

$

$

$

%

Operating income

$

$

$

$

$

$

%

F/X impact -- favorable (unfavorable)

$

(7)

$

$

$

8

$

8

$

N/A

Operating income -- Y/Y growth, excluding F/X

N/A

N/A

N/A

%

%

%

N/A

Operating margin -- % of North America net sales

%

%

%

%

%

%

N/A

Operating income -- TTM

$

$

$

$

$

$

%

Operating margin -- TTM % of North America net sales

%

%

%

%

%

%

N/A

International Segment:

Net sales

$

$

$

$

$

$

%

Net sales -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Net sales -- TTM

$

$

$

$

$

$

%

Operating income (loss)

$

$

$

$

$

$

N/A

F/X impact -- favorable (unfavorable)

$

$

$

$

(3)

$

$

N/A

Operating income (loss) -- Y/Y growth (decline), excluding F/X

%

%

%

N/A

N/A

N/A

N/A

Operating margin -- % of International net sales

%

%

%

%

%

%

N/A

Operating income (loss) -- TTM

$

$

$

$

$

$

N/A

Operating margin -- TTM % of International net sales

%

%

%

%

%

%

N/A

AWS Segment:

Net sales

$

$

$

$

$

$

%

Net sales -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Net sales -- TTM

$

$

$

$

$

$

%

Operating income

$

$

$

$

$

$

%

F/X impact -- favorable (unfavorable)

$

$

$

$

$

$

1

N/A

Operating income -- Y/Y growth (decline), excluding F/X

(8)

%

%

%

%

%

%

N/A

Operating margin -- % of AWS net sales

%

%

%

%

%

%

N/A

Operating income -- TTM

$

$

$

$

$

$

%

Operating margin -- TTM % of AWS net sales

%

%

%

%

%

%

N/A

AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions, except employee data)

(unaudited)

Y/Y %

Change

Net Sales

Online stores (1)

$

$

$

$

$

$

7

%

Online stores -- Y/Y growth, excluding F/X

5

%

6

%

8

%

7

%

6

%

8

%

N/A

Physical stores (2)

$

$

$

$

$

$

5

%

Physical stores -- Y/Y growth, excluding F/X

7

%

6

%

4

%

6

%

4

%

5

%

N/A

Third-party seller services (3)

$

$

$

$

$

$

%

Third-party seller services -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Advertising services (4)

$

$

$

$

$

$

%

Advertising services -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Subscription services (5)

$

$

$

$

$

$

%

Subscription services -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

AWS

$

$

$

$

$

$

%

AWS -- Y/Y growth, excluding F/X

%

%

%

%

%

%

N/A

Other (6)

$

$

$

$

$

$

7

%

Other -- Y/Y growth (decline), excluding F/X

%

(3)

%

8

%

%

(6)

%

5

%

N/A

Stock-based Compensation Expense

Cost of sales

$

$

$

$

$

$

(1)

%

Fulfillment

$

$

$

$

$

$

(5)

%

Technology and infrastructure

$

$

$

$

$

$

%

Sales and marketing

$

$

$

$

$

$

(9)

%

General and administrative

$

$

$

$

$

$

(8)

%

Total stock-based compensation expense

$

$

$

$

$

$

(9)

%

Other

WW shipping costs

$

$

$