AMZN » Topics » Limitations of Pro Forma Net Income

This excerpt taken from the AMZN 8-K filed Feb 2, 2005.

Limitations of Pro Forma Net Income

 

Pro forma net income has the same limitations as consolidated segment operating income. See “Consolidated Segment Operating Income — Limitations of Consolidated Segment Operating Income” above. In addition, when the 6.875% PEACS are retired, whether by early redemption or restructuring, or at maturity in 2010, the foreign currency effect of changes in the exchange ratio between the U.S. Dollar and the Euro will result in a cash effect. We compensate for this limitation by disclosing the effect of currency movements on our 6.875% PEACS on our consolidated statements of operations and presenting the fair value of our 6.875% PEACS in the notes to our financial statements.

 

During certain of our reporting periods our reported net income was greater than our pro forma net income.

 

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