Amazon.com Inc 8-K 2010-07-22

Press Release Dated July 22, 2010

Exhibit 99.1

LOGO

AMAZON.COM ANNOUNCES SECOND QUARTER SALES UP 41% TO $6.57 BILLION

SEATTLE(BUSINESS WIRE)July 22, 2010Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its second quarter ended June 30, 2010.

Operating cash flow was $2.56 billion for the trailing twelve months, compared with $1.88 billion for the trailing twelve months ended June 30, 2009. Free cash flow increased 29% to $1.99 billion for the trailing twelve months, compared with $1.54 billion for the trailing twelve months ended June 30, 2009.

Common shares outstanding plus shares underlying stock-based awards totaled 465 million on June 30, 2010, compared with 451 million a year ago.

Net sales increased 41% to $6.57 billion in the second quarter, compared with $4.65 billion in second quarter 2009. Excluding the $48 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales would have grown 42% compared with second quarter 2009.

Operating income increased 71% to $270 million in the second quarter, compared with $159 million in second quarter 2009. The unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter on operating income was $10 million. Second quarter 2009 operating income was negatively impacted by a $51 million legal settlement.

Net income increased 45% to $207 million in the second quarter, or $0.45 per diluted share, compared with net income of $142 million, or $0.32 per diluted share, in second quarter 2009.

Were seeing rapid growth in Kindle, Amazon Web Services, third-party sales, and retail. Were also encouraged by what we see in mobile. In the last twelve months, customers around the world have ordered more than $1 billion of products from Amazon using a mobile device, said Jeff Bezos, founder and CEO of Amazon.com. The leading mobile commerce device today is the smartphone, but were excited by the potential of the new category of wireless tablet computers. Over time, tablet computers could become a meaningful additional driver for our business.

Highlights

Readers are responding to Kindles uncompromising approach to the reading experience. Weighing 10.2 ounces, Kindle can be held comfortably in one hand for hours, has an e-ink display that is easy on the eyes even in bright daylight, has two weeks of battery life, and has free 3G wireless with no monthly fees or annual contractsall at a $189 price.

Amazon.com is now selling more Kindle books than hardcover books. Over the past three months, for every 100 hardcover books Amazon.com has sold, the Company has sold 143 Kindle books. Over the past month, for every 100 hardcover books Amazon.com has sold, the Company has sold 180 Kindle books. This is across Amazon.coms entire U.S. book business and includes sales of hardcover books where there is no Kindle edition. Free Kindle books are excluded and if included would make the number even higher.

Amazon sold more than 3x as many Kindle books in the first half of 2010 as in the first half of 2009.

The Association of American Publishers latest data reports that e-book sales grew 163 percent in the month of May and 207 percent year-to-date through May. Kindle book sales in May and year-to-date through May exceeded those growth rates.

On July 6, Hachette announced that James Patterson had sold 1.14 million e-books to date. Of those, 867,881 were Kindle books.

Five authorsCharlaine Harris, Stieg Larsson, Stephenie Meyer, James Patterson, and Nora Robertshave each sold more than 500,000 Kindle books.

Amazon.com continues to expand Kindles Buy once, read everywhere strategy with this quarters launch of Kindle for Android. Like all Kindle apps, Kindle for Android includes Whispersync technology, which automatically synchronizes your last page read, bookmarks, notes and highlights across your Kindle, Kindle DX, iPad, iPod touch, iPhone, Mac, PC, BlackBerry, and Android-based devices.

Kindle offers the largest selection of the most popular books people want to read. The U.S. Kindle Store now has more than 630,000 books, including New Releases and 106 of 110 New York Times Best Sellers. Over 510,000 of these books are $9.99 or less, including 75 New York Times Best Sellers. Over 1.8 million free, out-of-copyright, pre-1923 books are also available to read on Kindle.

North America segment sales, representing the Companys U.S. and Canadian sites, were $3.59 billion, up 46% from second quarter 2009.

International segment sales, representing the Companys U.K., German, Japanese, French and Chinese sites, were $2.98 billion, up 35% from second quarter 2009. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 38%.

Worldwide Media sales grew 18% to $2.87 billion.

Worldwide Electronics & Other General Merchandise sales grew 69% to $3.49 billion. Excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 70%.

The Company introduced Textbook Buyback, an easy-to-use program that helps students lower their textbook costs, giving them great value for their used textbooks.

The Amazon.co.uk and Amazon.de websites each launched Grocery stores offering customers free delivery on thousands of new items from brands such as Kraft, Nestlè, Mars, PepsiCo, Proctor & Gamble, and Unilever.

Businesses and developers in over 190 countries are taking advantage of Amazon Web Services (AWS). In the first half of 2010, AWS continued significant geographic expansion, launching the first Asia Pacific Region in Singapore as well as extending additional services including Amazon Virtual Private Cloud and Amazon Relational Database Service into the EU.

AWS announced a new storage option within the Amazon Simple Storage Service (S3), Amazon S3 Reduced Redundancy Storage (RRS), which enables customers to reduce their costs by storing non-critical, reproducible data at lower levels of redundancy than Amazon S3s standard storage.

AWS introduced Cluster Compute Instances, an Amazon Elastic Compute Cloud (EC2) instance type specifically tailored for high-performance computing.

Financial Guidance

The following forward-looking statements reflect Amazon.coms expectations as of July 22, 2010. 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.

Third Quarter 2010 Guidance

Net sales are expected to be between $6.900 billion and $7.625 billion, or to grow between 27% and 40% compared with third quarter 2009.

Operating income is expected to be between $210 million and $310 million, or between 16% decline and 24% growth compared with third quarter 2009.

This guidance includes approximately $130 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 Companys 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.coms financial results is included in Amazon.coms filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and subsequent filings.

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 Earths Biggest Selection. Amazon.com, Inc. seeks to be Earths 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 Amazons developer customers with access to in-the-cloud infrastructure services based on Amazons own back-end technology platform, which developers can use to enable virtually any type of business. Kindle 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 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, and www.amazon.cn. 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 June 30,						Six Months Ended June 30,						Twelve Months Ended June 30,
	2010			2009			2010			2009			2010			2009
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	$	1,844		$	1,701		$	3,444		$	2,769		$	1,936		$	1,548

OPERATING ACTIVITIES:
Net income		207			142			505			319			1,088			663
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		129			84			249			171			456			323
Stock-based compensation		111			85			196			152			386			300
Other operating expense (income), net		25			60			51			71			83			86
Losses (gains) on sales of marketable securities, net											(2	)		(2	)		(1	)
Other expense (income), net		(22	)		(14	)		(27	)		(12	)		(31	)		(53	)
Deferred income taxes		(8	)		6			(28	)		7			49			30
Excess tax benefits from stock-based compensation		(75	)		(20	)		(161	)		(70	)		(196	)		(122	)
Changes in operating assets and liabilities:
Inventories		(141	)		(23	)		180			84			(435	)		(261	)
Accounts receivable, net and other		(42	)		16			412			183			(252	)		(149	)
Accounts payable		(81	)		56			(1,972	)		(1,073	)		959			625
Accrued expenses and other		200			(6	)		(161	)		(128	)		265			182
Additions to unearned revenue		161			207			349			413			990			696
Amortization of previously unearned revenue		(214	)		(125	)		(441	)		(232	)		(799	)		(441	)

Net cash provided by (used in) operating activities		250			468			(848	)		(117	)		2,561			1,878

INVESTING ACTIVITIES:
Purchases of fixed assets, including internal-use software and website development		(196	)		(78	)		(336	)		(133	)		(575	)		(336	)
Acquisitions, net of cash acquired, and other		(21	)		(19	)		(40	)		(35	)		(45	)		(129	)
Sales and maturities of marketable securities and other investments		1,208			378			2,080			692			3,354			1,545
Purchases of marketable securities and other investments		(1,466	)		(560	)		(2,721	)		(951	)		(5,661	)		(1,877	)

Net cash provided by (used in) investing activities		(475	)		(279	)		(1,017	)		(427	)		(2,927	)		(797	)

FINANCING ACTIVITIES:
Excess tax benefits from stock-based compensation		75			20			161			70			196			122
Common stock repurchased																	(100	)
Proceeds from long-term debt and other		5			2			67			6			133			44
Repayments of long-term debt, capital lease, and finance lease obligations		(37	)		(25	)		(98	)		(368	)		(186	)		(663	)

Net cash provided by (used in) financing activities		43			(3	)		130			(292	)		143			(597	)
Foreign-currency effect on cash and cash equivalents		(33	)		49			(80	)		3			(84	)		(96	)

Net increase (decrease) in cash and cash equivalents		(215	)		235			(1,815	)		(833	)		(307	)		388

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	1,629		$	1,936		$	1,629		$	1,936		$	1,629		$	1,936


SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest	$	3		$	2		$	5		$	28		$	9		$	43
Cash paid for income taxes		43			23			46			34			60			64
Fixed assets acquired under capital leases		83			19			142			37			252			118
Fixed assets acquired under build-to-suit leases		60			61			120			117			191			173

AMAZON.COM, INC.

Consolidated Statements of Operations

(in millions, except per share data)

(unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2010			2009			2010			2009
Net sales	$	6,566		$	4,651		$	13,697		$	9,541

Operating expenses (1):
Cost of sales		4,957			3,518			10,458			7,260
Fulfillment		582			409			1,128			831
Marketing		211			129			412			257
Technology and content		408			299			773			575
General and administrative		113			77			210			145
Other operating expense (income), net (2)		25			60			51			71

Total operating expenses		6,296			4,492			13,032			9,139


Income from operations		270			159			665			402

Interest income		12			8			23			20
Interest expense		(9	)		(7	)		(16	)		(19	)
Other income (expense), net		24			19			27			24

Total non-operating income (expense)		27			20			34			25


Income before income taxes		297			179			699			427

Provision for income taxes		(88	)		(39	)		(189	)		(108	)
Equity-method investment activity, net of tax		(2	)		2			(5	)

Net income	$	207		$	142		$	505		$	319


Basic earnings per share	$	0.46		$	0.33		$	1.13		$	0.74


Diluted earnings per share	$	0.45		$	0.32		$	1.11		$	0.73


Weighted average shares used in computation of earnings per share:
Basic		447			431			446			430

Diluted		455			440			455			438

___________

(1) Includes stock-based compensation as follows:
Fulfillment	$	24		$	20		$	42		$	35
Marketing		7			5			12			9
Technology and content		58			46			103			82
General and administrative		22			14			39			26

(2) Q2 2009 was negatively impacted by a $51 million legal settlement.

AMAZON.COM, INC.

Segment Information

(in millions)

(unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2010			2009			2010			2009
North America
Net sales	$	3,590		$	2,451		$	7,370		$	5,030
Operating expenses
Cost of sales		2,570			1,779			5,332			3,664
Direct segment operating expenses (1)		820			547			1,565			1,091

Segment operating income	$	200		$	125		$	473		$	275


International
Net sales	$	2,976		$	2,200		$	6,327		$	4,511
Operating expenses
Cost of sales		2,387			1,739			5,126			3,596
Direct segment operating expenses (1)		383			282			762			565

Segment operating income	$	206		$	179		$	439		$	350


Consolidated
Net sales	$	6,566		$	4,651		$	13,697		$	9,541
Operating expenses
Cost of sales		4,957			3,518			10,458			7,260
Direct segment operating expenses		1,203			829			2,327			1,656

Segment operating income		406			304			912			625
Stock-based compensation		(111	)		(85	)		(196	)		(152	)
Other operating income (expense), net (2)		(25	)		(60	)		(51	)		(71	)

Income from operations		270			159			665			402
Total non-operating income (expense), net		27			20			34			25
Provision for income taxes		(88	)		(39	)		(189	)		(108	)
Equity-method investment activity, net of tax		(2	)		2			(5	)

Net income	$	207		$	142		$	505		$	319


Segment Highlights:
Y/Y net sales growth:
North America		46	%		13	%		47	%		17	%
International		35			16			40			16
Consolidated		41			14			44			16
Y/Y segment operating income growth:
North America		61	%		30	%		72	%		22	%
International		15			20			25			27
Consolidated		34			24			46			24
Net sales mix:
North America		55	%		53	%		54	%		53	%
International		45			47			46			47

		100	%		100	%		100	%		100	%

(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.

(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 June 30,						Six Months Ended June 30,
	2010			2009			2010			2009
North America
Media	$	1,324		$	1,148		$	2,921		$	2,454
Electronics and other general merchandise		2,090			1,187			4,114			2,359
Other		176			116			335			217

Total North America	$	3,590		$	2,451		$	7,370		$	5,030


International
Media	$	1,550		$	1,294		$	3,383		$	2,712
Electronics and other general merchandise		1,399			882			2,887			1,756
Other		27			24			57			43

Total International	$	2,976		$	2,200		$	6,327		$	4,511


Consolidated
Media	$	2,874		$	2,442		$	6,304		$	5,166
Electronics and other general merchandise		3,489			2,069			7,001			4,115
Other		203			140			392			260

Total Consolidated	$	6,566		$	4,651		$	13,697		$	9,541


Y/Y Net Sales Growth:
North America:
Media		15	%		0	%		19	%		4	%
Electronics and other general merchandise		76			29			74			35
Other		52			16			54			12
Total North America		46			13			47			17

International:
Media		20	%		3	%		25	%		4	%
Electronics and other general merchandise		59			45			64			39
Other		13			(8	)		32			1
Total International		35			16			40			16

Consolidated:
Media		18	%		1	%		22	%		4	%
Electronics and other general merchandise		69			35			70			37
Other		45			11			51			10
Total Consolidated		41			14			44			16

Y/Y Net Sales Growth Excluding Effect of Exchange Rates:
International:
Media		21	%		12	%		22	%		15	%
Electronics and other general merchandise		63			60			62			55
Other		18			10			31			22
Total International		38			28			38			28

Consolidated:
Media		18	%		7	%		20	%		10	%
Electronics and other general merchandise		70			41			69			44
Other		46			15			50			13
Total Consolidated		42			20			42			22

Consolidated Net Sales Mix:
Media		44	%		52	%		46	%		54	%
Electronics and other general merchandise		53			45			51			43
Other		3			3			3			3

		100	%		100	%		100	%		100	%

AMAZON.COM, INC.

Consolidated Balance Sheets

(in millions, except per share data)


	June 30, 2010			December 31, 2009			June 30, 2009
	(unaudited)						(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,629		$	3,444		$	1,936
Marketable securities		3,479			2,922			1,276
Inventories		1,940			2,171			1,325
Accounts receivable, net and other		805			988			584
Deferred tax assets		265			272			183

Total current assets		8,118			9,797			5,304
Fixed assets, net		1,704			1,290			981
Deferred tax assets		29			18			118
Goodwill		1,229			1,234			451
Other assets		1,317			1,474			821

Total assets	$	12,397		$	13,813		$	7,675

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	3,545		$	5,605		$	2,508
Accrued expenses and other		1,705			1,759			1,128

Total current liabilities		5,250			7,364			3,636
Long-term debt		132			109			109
Other long-term liabilities		1,158			1,083			674

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 464, 461 and 448
Outstanding shares 448, 444 and 432		5			5			4
Treasury stock, at cost		(600	)		(600	)		(600	)
Additional paid-in capital		6,056			5,736			4,321
Accumulated other comprehensive loss		(282	)		(56	)		(58	)
Retained earnings (accumulated deficit)		678			172			(411	)

Total stockholders' equity		5,857			5,257			3,256

Total liabilities and stockholders' equity	$	12,397		$	13,813		$	7,675

AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions, except per share data)

(unaudited)


	Q2 2009			Q3 2009			Q4 2009			Q1 2010			Q2 2010			Y/Y % Change
Cash Flows and Shares
Operating cash flow trailing twelve months (TTM)	$	1,878		$	2,253		$	3,293		$	2,780		$	2,561		36	%
Purchases of fixed assets (incl. internal-use software & website development) TTM	$	336		$	337		$	373		$	458		$	575		71	%
Free cash flow (operating cash flow less purchases of fixed assets) TTM	$	1,542		$	1,916		$	2,920		$	2,322		$	1,986		29	%
Free cash flow TTM Y/Y growth		89	%		98	%		114	%		62	%		29	%	N/A
Invested capital (1)	$	3,666		$	3,847		$	4,449		$	5,104		$	5,820		N/A
Return on invested capital (2)		42	%		50	%		66	%		45	%		34	%	N/A

Common shares and stock-based awards outstanding		451			451			461			463			465		3	%
Common shares outstanding		432			433			444			446			448		4	%
Stock-based awards outstanding		19			18			17			18			17		(11	%)
Stock-based awards outstanding % of common shares outstanding		4.4	%		4.2	%		3.8	%		4.0	%		3.8	%	N/A

Results of Operations
Worldwide (WW) net sales	$	4,651		$	5,449		$	9,519		$	7,131		$	6,566		41	%
WW net sales Y/Y growth, excluding F/X		20	%		29	%		37	%		42	%		42	%	N/A
WW net sales TTM	$	20,509		$	21,693		$	24,509		$	26,750		$	28,664		40	%
WW net sales TTM Y/Y growth, excluding F/X		24	%		24	%		29	%		33	%		38	%	N/A
Operating income (3)	$	159		$	251		$	476		$	394		$	270		71	%
Operating income Y/Y growth (decrease), excluding F/X		(13	%)		69	%		63	%		56	%		77	%	N/A
Operating margin % of WW net sales		3.4	%		4.6	%		5.0	%		5.5	%		4.1	%	N/A

Operating income TTM (3)	$	829		$	925		$	1,129		$	1,279		$	1,391		68	%
Operating income TTM Y/Y growth, excluding F/X		13	%		22	%		39	%		44	%		65	%	N/A
Operating margin TTM % of WW net sales		4.0	%		4.3	%		4.6	%		4.8	%		4.9	%	N/A
Net income (3)	$	142		$	199		$	384		$	299		$	207		45	%
Net income per diluted share	$	0.32		$	0.45		$	0.85		$	0.66		$	0.45		41	%
Net income TTM (3)	$	663		$	743		$	902		$	1,024		$	1,088		64	%
Net income per diluted share TTM	$	1.52		$	1.69		$	2.04		$	2.30		$	2.42		59	%

Segments
North America Segment:
Net sales	$	2,451		$	2,843		$	4,956		$	3,780		$	3,590		46	%
Net sales Y/Y growth, excluding F/X		13	%		24	%		36	%		46	%		46	%	N/A
Net sales TTM	$	10,963		$	11,503		$	12,828		$	14,030		$	15,168		38	%
Operating income	$	125		$	156		$	278		$	273		$	200		61	%
Operating margin % of North America net sales		5.1	%		5.5	%		5.6	%		7.2	%		5.6	%	N/A
Operating income TTM	$	494		$	562		$	709		$	832		$	907		84	%
Operating income TTM Y/Y growth, excluding F/X		8	%		20	%		59	%		79	%		84	%	N/A
Operating margin TTM % of North America net sales		4.5	%		4.9	%		5.5	%		5.9	%		6.0	%	N/A

International Segment:
Net sales	$	2,200		$	2,606		$	4,563		$	3,351		$	2,976		35	%
Net sales Y/Y growth, excluding F/X		28	%		35	%		37	%		37	%		38	%	N/A
Net sales TTM	$	9,546		$	10,190		$	11,681		$	12,720		$	13,496		41	%
Net sales TTM % of WW net sales		47	%		47	%		48	%		48	%		47	%	N/A
Operating income	$	179		$	194		$	319		$	234		$	206		15	%
Operating margin % of International net sales		8.1	%		7.4	%		7.0	%		7.0	%		6.9	%	N/A
Operating income TTM	$	722		$	773		$	863		$	925		$	952		32	%
Operating income TTM Y/Y growth, excluding F/X		49	%		49	%		41	%		33	%		28	%	N/A
Operating margin TTM % of International net sales		7.6	%		7.6	%		7.4	%		7.3	%		7.1	%	N/A

Consolidated Segments:
Operating expenses (4)	$	4,347		$	5,099		$	8,922		$	6,624		$	6,160		42	%
Operating expenses TTM (4)	$	19,293		$	20,358		$	22,937		$	24,993		$	26,805		39	%
Operating income	$	304		$	350		$	597		$	507		$	406		34	%
Operating margin % of consolidated sales		6.5	%		6.4	%		6.3	%		7.1	%		6.2	%	N/A
Operating income TTM	$	1,216		$	1,335		$	1,572		$	1,757		$	1,859		53	%
Operating income TTM Y/Y growth, excluding F/X		29	%		35	%		48	%		51	%		51	%	N/A
Operating margin TTM % of consolidated net sales		5.9	%		6.2	%		6.4	%		6.6	%		6.5	%	N/A

AMAZON.COM, INC.

Supplemental Financial Information and Business Metrics

(in millions, except inventory turnover, accounts payable days and employee data)

(unaudited)


	Q2 2009			Q3 2009			Q4 2009			Q1 2010			Q2 2010			Y/Y % Change
Supplemental
Supplemental North America Segment Net Sales:
Media	$	1,148		$	1,412		$	2,099		$	1,597		$	1,324		15	%
Media Y/Y growth, excluding F/X		0	%		14	%		19	%		22	%		15	%	N/A
Media TTM	$	5,449		$	5,616		$	5,964		$	6,255		$	6,432		18	%
Electronics and other general merchandise	$	1,187		$	1,293		$	2,662		$	2,024		$	2,090		76	%
Electronics and other general merchandise Y/Y growth, excluding F/X		29	%		36	%		54	%		73	%		76	%	N/A
Electronics and other general merchandise TTM	$	5,043		$	5,385		$	6,314		$	7,166		$	8,069		60	%
Electronics and other general merchandise TTM % of North America net sales		46	%		47	%		49	%		51	%		53	%	N/A
Other	$	116		$	138		$	195		$	159		$	176		52	%
Other TTM	$	471		$	502		$	550		$	608		$	668		42	%

Supplemental International Segment Net Sales:
Media	$	1,294		$	1,517		$	2,580		$	1,833		$	1,550		20	%
Media Y/Y growth, excluding F/X		12	%		22	%		26	%		23	%		21	%	N/A
Media TTM	$	5,849		$	6,118		$	6,810		$	7,225		$	7,480		28	%
Electronics and other general merchandise	$	882		$	1,064		$	1,947		$	1,489		$	1,399		59	%
Electronics and other general merchandise Y/Y growth, excluding F/X		60	%		58	%		56	%		61	%		63	%	N/A
Electronics and other general merchandise TTM	$	3,603		$	3,977		$	4,768		$	5,382		$	5,899		64	%
Electronics and other general merchandise TTM % of International net sales		38	%		39	%		41	%		42	%		44	%	N/A
Other	$	24		$	25		$	36		$	29		$	27		13	%
Other TTM	$	94		$	95		$	103		$	114		$	117		24	%

Supplemental Worldwide Net Sales:
Media	$	2,442		$	2,929		$	4,679		$	3,430		$	2,874		18	%
Media Y/Y growth, excluding F/X		7	%		18	%		23	%		22	%		18	%	N/A
Media TTM	$	11,298		$	11,734		$	12,774		$	13,480		$	13,912		23	%
Electronics and other general merchandise	$	2,069		$	2,357		$	4,609		$	3,513		$	3,489		69	%
Electronics and other general merchandise Y/Y growth, excluding F/X		41	%		45	%		54	%		68	%		70	%	N/A
Electronics and other general merchandise TTM	$	8,646		$	9,362		$	11,082		$	12,548		$	13,968		62	%
Electronics and other general merchandise TTM % of WW net sales		42	%		43	%		45	%		47	%		49	%	N/A
Other	$	140		$	163		$	231		$	188		$	203		45	%
Other TTM	$	565		$	597		$	653		$	722		$	785		39	%

Balance Sheet
Cash and marketable securities (5)	$	3,504		$	4,304		$	6,672		$	5,381		$	5,419		55	%
Inventory, net ending	$	1,325		$	1,617		$	2,171		$	1,820		$	1,940		46	%
Inventory turnover, average TTM		12.4			12.1			12.2			12.6			12.5		1	%
Fixed assets, net	$	981		$	1,086		$	1,290		$	1,436		$	1,704		74	%
Accounts payable ending	$	2,508		$	3,354		$	5,605		$	3,619		$	3,545		41	%
Accounts payable days ending		65			72			68			59			65		0	%

Other
WW shipping revenue	$	185		$	208		$	341		$	248		$	239		29	%
WW shipping costs	$	332		$	388		$	696		$	518		$	487		47	%
WW net shipping costs	$	147		$	180		$	355		$	270		$	248		69	%
WW net shipping costs % of WW net sales		3.1	%		3.3	%		3.7	%		3.8	%		3.8	%	N/A
Employees (full-time and part-time; excludes contractors & temporary personnel)		21,000			21,700			24,300			26,100			28,300		35	%

(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: $292 million Q2 2009, $303 million Q3 2009, $306 million in Q4 2009, $318 million in Q1 2010 and $311 million in Q2 2010.

Amazon.com, Inc.

Certain Definitions

Customer Accounts

References to customers mean customer accounts, which are unique e-mail addresses, established either when a customers initial order is shipped 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 and www.amazon.cn, 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.

Contacts:


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

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