UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________
FORM 10-Q
____________________________________
(Mark One)
- QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2020
or
- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .
Commission File No. 000-22513
____________________________________
AMAZON.COM, INC.
(Exact name of registrant as specified in its charter)
____________________________________ | |
Delaware | 91-1646860 |
(State or other jurisdiction of | (I.R.S. Employer |
incorporation or organization) | Identification No.) |
410 Terry Avenue North, Seattle, Washington 98109-5210
(206) 266-1000
(Address and telephone number, including area code, of registrant's principal executive offices)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered |
Common Stock, par value $.01 per share | AMZN | Nasdaq Global Select Market |
____________________________________ |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☒ | Accelerated filer | ☐ |
Non-accelerated filer | ☐ | Smaller reporting company | ☐ |
Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ 501,751,183 shares of common stock, par value $0.01 per share, outstanding as of October 21, 2020
AMAZON.COM, INC.
FORM 10-Q
For the Quarterly Period Ended September 30, 2020
INDEX
PART I. FINANCIAL INFORMATION | Page | ||
Item 1. | |||
Consolidated Balance Sheets | 6 | ||
Notes to Consolidated Financial Statements | 7 | ||
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 19 | |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 32 | |
Item 4. | Controls and Procedures | 33 | |
PART II. OTHER INFORMATION | |||
Item 1. | Legal Proceedings | 34 | |
Item 1A. | Risk Factors | 34 | |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 44 | |
Item 3. | Defaults Upon Senior Securities | 44 | |
Item 4. | Mine Safety Disclosures | 44 | |
Item 5. | Other Information | 44 | |
Item 6. | Exhibits | 45 | |
Signatures | 46 | ||
2 | |||
PART I. FINANCIAL INFORMATION | ||||||||||||||||||||||||
Item 1. | Financial Statements | |||||||||||||||||||||||
AMAZON.COM, INC. | ||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||||||||||||
(in millions) | ||||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | Twelve Months Ended | ||||||||||||||||||||||
September 30, | September 30, | September 30, | ||||||||||||||||||||||
2019 | 2020 | 2019 | 2020 | 2019 | 2020 | |||||||||||||||||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | $ | 22,965 | $ | 37,842 | $ | 32,173 | $ | 36,410 | $ | 21,032 | $ | 23,554 | ||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||||||||||||
Net income | 2,134 | 6,331 | 8,320 | 14,109 | 11,347 | 17,377 | ||||||||||||||||||
Adjustments to reconcile net income to net cash from operating activities: | ||||||||||||||||||||||||
Depreciation and amortization of property and equipment and capitalized content costs, operating lease | 5,563 | 6,523 | 15,619 | 17,633 | 19,881 | 23,803 | ||||||||||||||||||
assets, and other | ||||||||||||||||||||||||
Stock-based compensation | 1,779 | 2,288 | 5,024 | 6,646 | 6,441 | 8,486 | ||||||||||||||||||
Other operating expense (income), net | 47 | 67 | 114 | 416 | 186 | 466 | ||||||||||||||||||
Other expense (income), net | 388 | (1,051) | 246 | (1,255) | 443 | (1,749) | ||||||||||||||||||
Deferred income taxes | 92 | 295 | 612 | 1,082 | 784 | 1,267 | ||||||||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||||||||
Inventories | (381) | (3,899) | (1,762) | (3,178) | (3,112) | (4,694) | ||||||||||||||||||
Accounts receivable, net and other | (1,181) | (2,016) | (3,776) | (3,608) | (5,172) | (7,515) | ||||||||||||||||||
Accounts payable | 226 | 3,658 | (2,490) | 4,231 | 4,393 | 14,914 | ||||||||||||||||||
Accrued expenses and other | (722) | (310) | (4,277) | (1,375) | (1,612) | 1,520 | ||||||||||||||||||
Unearned revenue | (53) | 78 | 1,225 | 932 | 1,753 | 1,417 | ||||||||||||||||||
Net cash provided by (used in) operating activities | 7,892 | 11,964 | 18,855 | 35,633 | 35,332 | 55,292 | ||||||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||||||||||||
Purchases of property and equipment | (4,697) | (11,063) | (11,549) | (25,317) | (15,282) | (30,629) | ||||||||||||||||||
Proceeds from property and equipment sales and incentives | 1,312 | 1,255 | 2,800 | 3,467 | 3,414 | 4,838 | ||||||||||||||||||
Acquisitions, net of cash acquired, and other | (398) | (1,735) | (1,684) | (1,945) | (2,015) | (2,722) | ||||||||||||||||||
Sales and maturities of marketable securities | 7,251 | 13,135 | 15,056 | 32,899 | 16,994 | 40,525 | ||||||||||||||||||
Purchases of marketable securities | (8,542) | (17,468) | (25,368) | (51,678) | (27,428) | (58,122) | ||||||||||||||||||
Net cash provided by (used in) investing activities | (5,074) | (15,876) | (20,745) | (42,574) | (24,317) | (46,110) | ||||||||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||||||||||||
Proceeds from short-term debt, and other | 415 | 1,311 | 722 | 4,361 | 1,292 | 5,042 | ||||||||||||||||||
Repayments of short-term debt, and other | (341) | (1,349) | (704) | (3,886) | (1,129) | (4,701) | ||||||||||||||||||
Proceeds from long-term debt | 287 | - | 453 | 9,994 | 589 | 10,412 | ||||||||||||||||||
Repayments of long-term debt | (14) | (1,198) | (115) | (1,439) | (124) | (2,490) | ||||||||||||||||||
Principal repayments of finance leases | (2,307) | (2,857) | (6,848) | (8,274) | (8,754) | (11,054) | ||||||||||||||||||
Principal repayments of financing obligations | - | (12) | (3) | (44) | (129) | (68) | ||||||||||||||||||
Net cash provided by (used in) financing activities | (1,960) | (4,105) | (6,495) | 712 | (8,255) | (2,859) | ||||||||||||||||||
Foreign currency effect on cash, cash equivalents, and restricted cash | (269) | 377 | (234) | 21 | (238) | 325 | ||||||||||||||||||
Net increase (decrease) in cash, cash equivalents, and restricted cash | 589 | (7,640) | (8,619) | (6,208) | 2,522 | 6,648 | ||||||||||||||||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | $ | 23,554 | $ | 30,202 | $ | 23,554 | $ | 30,202 | $ | 23,554 | $ | 30,202 | ||||||||||||
See accompanying notes to consolidated financial statements.
3
AMAZON.COM, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(unaudited)
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2019 | 2020 | 2019 | 2020 | ||||||||||||
Net product sales | $ | 39,726 | $ | 52,774 | $ | 109,866 | $ | 144,859 | |||||||
Net service sales | 30,255 | 43,371 | 83,220 | 115,650 | |||||||||||
Total net sales | 69,981 | 96,145 | 193,086 | 260,509 | |||||||||||
Operating expenses: | |||||||||||||||
Cost of sales | 41,302 | 57,106 | 111,559 | 154,023 | |||||||||||
Fulfillment | 10,167 | 14,705 | 28,040 | 40,043 | |||||||||||
Technology and content | 9,200 | 10,976 | 26,191 | 30,691 | |||||||||||
Marketing | 4,752 | 5,434 | 12,707 | 14,605 | |||||||||||
General and administrative | 1,348 | 1,668 | 3,791 | 4,700 | |||||||||||
Other operating expense (income), net | 55 | 62 | 136 | 421 | |||||||||||
Total operating expenses | 66,824 | 89,951 | 182,424 | 244,483 | |||||||||||
Operating income | 3,157 | 6,194 | 10,662 | 16,026 | |||||||||||
Interest income | 224 | 118 | 621 | 455 | |||||||||||
Interest expense | (396) | (428) | (1,145) | (1,233) | |||||||||||
Other income (expense), net | (353) | 925 | (215) | 1,165 | |||||||||||
Total non-operating income (expense) | (525) | 615 | (739) | 387 | |||||||||||
Income before income taxes | 2,632 | 6,809 | 9,923 | 16,413 | |||||||||||
Provision for income taxes | (494) | (569) | (1,588) | (2,298) | |||||||||||
Equity-method investment activity, net of tax | (4) | 91 | (15) | (6) | |||||||||||
Net income | |||||||||||||||
$ | 2,134 | $ | 6,331 | $ | 8,320 | $ | 14,109 | ||||||||
Basic earnings per share | $ | 4.31 | $ | 12.63 | $ | 16.87 | $ | 28.24 | |||||||
Diluted earnings per share | |||||||||||||||
$ | 4.23 | $ | 12.37 | $ | 16.53 | $ | 27.72 | ||||||||
Weighted-average shares used in computation of earnings per share: | |||||||||||||||
Basic | 495 | 501 | 493 | 500 | |||||||||||
Diluted | 504 | 512 | 503 | 509 |
See accompanying notes to consolidated financial statements.
4
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