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Amazon.com Q4 2009 Financial Results Conference Call Slides
- Q4 2009 financial results showed strong growth with net sales up 42% year-over-year to $9.5 billion and GAAP operating income up 75% to $476 million. - International sales grew 49% year-over-year with over 45% of worldwide revenue coming from outside North America. - Free cash flow increased 114% year-over-year to $2.9 billion driven by strong operating cash flow.
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Amazon.com Q4 2009 Financial Results Conference Call Slides
- 1. Q4 2009 FinancialResults Conference Call Slides
- 2. This presentation maycontain forward-looking statements which are inherently difficult to predict. Actual results could differ materially for a variety of reasons, including 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, 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, including its most recent Annual Report on Form 10-K and subsequent filings. Additional information relating to certain of our financial measures contained herein is available in the appendix to our presentation, our most recent earnings release and at our website at www.amazon.com/ir under ‘Financial Documents’. 2
- 3. MM Free Cash Flow -- TTM (1) Up 114% Y/Y $2,920MM $1,364MM Long Term Goal – Optimize Free Cash Flow (1) Free Cash Flow, a non-GAAP financial measure, is GAAP Operating Cash Flow Less Purchases of Fixed Assets. See appendix for a reconciliation of Operating Cash Flow to Free Cash Flow. 3
- 4. Shares (1) MM 446 461 Efficiently Managing Dilution – Up 3% Y/Y (1) Q4 2009 includes the issuance of 9 million shares of common stock to acquire Zappos.com, Inc. 4
- 5. Return on InvestedCapital -- TTM (1) 66% 41% Efficient Capital Structure (1) ROIC = TTM Free Cash Flow divided by average Total Assets minus Current Liabilities, excluding current portion of our Long Term Debt, over 5 quarter ends. 5
- 6. MM Net Sales $9,519MM $6,704MM Up 42% Y/Y (37% F/X Adjusted) 6
- 7. MM Net Sales -- TTM Up 28% Y/Y; 29% $24,509MM F/X Adjusted $19,166MM 45% of WW TTM Revenue from EGM, Up From 39% Y/Y 7
- 8. GAAP Operating Income (1) MM Up 75% Y/Y $476MM $272MM (1) Q2 2009 includes the impact of our settlement with Toysrus.com LLC for $51 million. 8
- 9. GAAP Operating Income– TTM (1) MM Up 34% Y/Y $1,129MM $842MM (1) Q2 2008 includes a $53 million non-cash gain recognized on the sale of our European DVD rental assets. Q2 2009 includes the impact of our settlement with Toysrus.com LLC for $51 million. 9
- 10. Consolidated Segment OperatingIncome (1) MM Up 66% Y/Y $597MM $359MM (1) Consolidated Segment Operating Income (CSOI), a non-GAAP financial measure, excludes Stock-Based Compensation and Other Operating Income (Expense). See appendix for a reconciliation of CSOI to GAAP Operating Income. 10
- 11. Consolidated Segment OperatingIncome -- TTM (1) MM Up 44% Y/Y $1,572MM $1,093MM (1) Consolidated Segment Operating Income (CSOI), a non-GAAP financial measure, excludes Stock-Based Compensation and Other Operating Income (Expense). See appendix for a reconciliation of CSOI to GAAP Operating Income. 11
- 12. GAAP Net Income (1) MM Up 71% Y/Y $384MM $225MM (1) Q2 2009 includes the impact of our settlement with Toysrus.com LLC for $51 million. 12
- 13. Segment Results –North America MM MM Up 36% Up 113% Y/Y Y/Y $4,956MM $278MM $3,631MM $130MM TTM Net Sales Over $12.8B (1) A significant 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. 13
- 14. Segment Results –International MM MM Up 49%Y/Y; 37% Up 39% Y/Y; 25% F/X Adjusted F/X Adjusted $319MM $4,563MM $229MM $3,073MM TTM Net Sales Over $11.6B 14
- 15. Supplemental Revenue Highlights– Media MM MM Up 37% Y/Y; 26% Up 20% Y/Y F/X Adjusted $2,580MM $2,099MM $1,751MM $1,889MM Books, Music, Movies, Video Games and Consoles, Software and Digital Downloads 15
- 16. Supplemental Revenue Highlights– Electronics & Other General Merchandise (EGM) MM MM Up 68% Y/Y; 56% Up 54% Y/Y F/X Adjusted $2,662MM $1,947MM $1,733MM $1,156MM Computers & Office, Electronics, Home & Garden, Grocery, Health & Beauty, Toys, Kids & Baby, Apparel, Shoes & Jewelry, Sports & Outdoors, Tools, Auto & Industrial 16
- 17. Supplemental Revenue Highlights– Other MM MM Up 27% Y/Y; 18% Up 33% Y/Y F/X Adjusted $36MM $195MM $28MM $147MM Marketing and Promotional Activities, Amazon Web Services, Amazon Enterprise Solutions, & Co-branded Credit Cards 17
- 18. Appendix 18
- 19. Free Cash FlowReconciliation -- TTM $MM Q4 ‘08 Q1 ‘09 Q2 ‘09 Q3 ‘09 Q4 ‘09 Operating Cash Flow $ 1,697 $ 1,757 $ 1,878 $ 2,253 $ 3,293 Purchases of Fixed Assets, Including Internal-Use Software and Website Development (333) (326) (336) (337) (373) Free Cash Flow $ 1,364 $ 1,431 $ 1,542 $ 1,916 $ 2,920 19
- 20. Consolidated Segment OperatingIncome Reconciliation $MM Q4 ‘08 Q1 ‘09 Q2 ‘09 Q3 ‘09 Q4 ‘09 Consolidated Segment Operating Income $ 359 $ 322 $ 304 $ 350 $ 597 Stock-Based Compensation (79) (67) (85) (90) (100) Other Operating Income (Expense), Net (8) (11) (60) (9) (21) GAAP Operating Income $ 272 $ 244 $ 159 $ 251 $ 476 20
- 21. Consolidated Segment OperatingIncome Reconciliation -- TTM $MM Q4 ‘08 Q1 ‘09 Q2 ‘09 Q3 ‘09 Q4 ‘09 Consolidated Segment Operating Income $ 1,093 $ 1,156 $ 1,216 $ 1,335 $ 1,572 Stock-Based Compensation (275) (288) (300) (320) (341) Other Operating Income (Expense), Net 24 19 (87) (90) (102) GAAP Operating Income $ 842 $ 887 $ 829 $ 925 $ 1,129 21