AMZN » Topics » Income from Operations

This excerpt taken from the AMZN 10-Q filed Apr 24, 2009.

Income from Operations

Income from operations was $244 million and $198 million during Q1 2009 and Q1 2008. The increase is primarily a result of increased gross profit relative to operating expenses.

These excerpts taken from the AMZN 10-K filed Jan 30, 2009.

Income from Operations

Income from operations was $842 million, $655 million, and $389 million during 2008, 2007, and 2006. The increase in each year is primarily a result of increased revenue and gross profit relative to operating expenses. Additionally, 2008 includes the $53 million non-cash gain on the sale of our European DVD rental assets included in “Other operating expense (income), net.”

Income from Operations


Income from operations was $842 million, $655 million, and $389 million during 2008, 2007, and 2006. The increase in each year is primarily a result of
increased revenue and gross profit relative to operating expenses. Additionally, 2008 includes the $53 million non-cash gain on the sale of our European DVD rental assets included in “Other operating expense (income), net.”

STYLE="margin-top:18px;margin-bottom:0px; margin-left:2%">Interest Expense and Income

SIZE="2">The primary component of our net interest expense is the interest we incur on our long-term debt instruments, including our 4.75% Convertible Subordinated Notes, which were no longer outstanding at December 31, 2008, and our 6.875%
PEACS, which had a principal balance of €240 million ($335 million based on the exchange rate) at December 31, 2008. Interest expense was $71 million, $77 million, and $78 million, in 2008, 2007, and 2006 with the decline primarily
relating to principal reductions of $899 million in 2008 and $300 million in 2006.

Our total debt was $468 million and $1.3 billion at
December 31, 2008 and 2007. See Item 8 of Part II, “Financial Statements and Supplementary Data—Note 5—Long-Term Debt.”

FACE="Times New Roman" SIZE="2">Our interest income was $83 million, $90 million, and $59 million during 2008, 2007, and 2006. We generally invest our excess cash in investment grade short- to intermediate-term fixed income securities and AAA-rated
money market funds. Our interest income corresponds with the average balance of invested funds and the prevailing rates we are earning on them, which vary depending on the geographies and currencies in which they are invested.

STYLE="margin-top:18px;margin-bottom:0px; margin-left:2%">Other Income (Expense), Net

SIZE="2">Other income (expense), net, consisted of the following:

 



















































































































   Year Ended December 31, 
       2008          2007          2006     
   (in millions) 

Foreign-currency gain (loss) on remeasurement of 6.875% PEACS (1)

  $15  $(33) $(37)

Foreign-currency gain on intercompany balances (2)

   23   32   50 

Other

   9   (7)  (6)
             

Other income (expense), net

  $47  $(8) $7 
             

 





(1)Each period the remeasurement of our 6.875% PEACS from Euros to U.S. Dollars results in gains or losses recorded to “Other income (expense), net” on our consolidated
statements of operations.




(2)Represents the gains (losses) associated with the remeasurement of intercompany balances due to changes in foreign exchange rates. See Item 8 of Part II, “Financial
Statements and Supplementary Data—Note 1—Description of Business and Accounting Policies—Foreign Currency.”

 


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This excerpt taken from the AMZN 10-K filed Feb 11, 2008.

Income from Operations

Income from operations was $655 million, $389 million, and $432 million during 2007, 2006, and 2005. The increase in 2007 from 2006 is primarily a result of the increased growth rate of our revenue and gross profit relative to operating expenses. The decrease in 2006 from 2005 is primarily a result of an increase in spending for technology and content.

This excerpt taken from the AMZN 10-K filed Feb 16, 2007.

Income from Operations

Income from operations was $389 million, $432 million, and $440 million during 2006, 2005, and 2004. The decrease in 2006 from 2005 is primarily a result of an increase in spending for technology and content. The decrease in 2005 from 2004 is primarily a result of an increase in spending for technology and content, an increase in stock-based compensation that is now recorded under SFAS No. 123(R) fair value accounting, and a payment of $40 million to settle a patent lawsuit. These increased expenditures were partially offset by higher net sales and gross profit.

This excerpt taken from the AMZN 10-K filed Feb 17, 2006.

Income from Operations

 

Our income from operations was $432 million, $440 million, and $270 million during 2005, 2004, and 2003. The decrease in 2005 from 2004 is primarily a result of an increase in spending for technology and content, an increase in stock-based compensation that is now recorded under SFAS 123(R) fair value accounting, and a payment of $40 million to settle a patent lawsuit. These increased expenditures were partially offset by higher net sales and gross profit. The increase in operating income in 2004 compared with 2003 was primarily attributed to increases in net sales and gross profit growth and leveraging operating expenses relative to net sales. Income from operations was negatively affected by year-over-year changes in exchange rates in 2005, and positively affected in 2004 and 2003.

 

This excerpt taken from the AMZN 10-Q filed Apr 28, 2005.

Income from Operations

 

Our income from operations was $108 million and $110 million in Q1 2005 and Q1 2004. This year-over-year decrease primarily resulted from a $14 million expense related to our adoption of SFAS 123(R), an $8 million charge related to possible settlements of outstanding litigation, and $5 million in losses for assets removed from service during Q1 2005. These items, as well as other operating expense increases, were partially offset by growth in net sales of 24% and an increase in gross profit of 27%.

 

This excerpt taken from the AMZN 10-K filed Mar 11, 2005.

Income from Operations

 

Our income from operations was $440 million, $271 million, and $64 million during 2004, 2003, and 2002. These increases primarily result from net sales and gross profit growth and declines in operating expenses as a percent of net sales as we leverage the fixed cost portion of our cost structure and seek to improve our variable costs through process efficiencies. Additionally, in 2004 and 2003 operating income improved from year-over-year reductions of $47 million and $8 million in stock-based compensation expense associated with variable accounting, offset by increases in stock-based compensation of $18 million and $27 million associated with restricted stock units.

 

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