Amazon.com Announces Profitability In U.S.-Based Book Sales, Financial Results for Fourth Quarter 1999.Business Writers SEATTLE--(BUSINESS WIRE)--February. 2, 2000 90 percent quarter-to-quarter growth is amazon Amazon, in Greek mythology Amazon (ăm`əzŏn), in Greek mythology, one of a tribe of warlike women who lived in Asia Minor. .com's fastest ever as a public company; customer total now over 17 million; amazon.com (Amazon.com, Seattle, WA, www.amazon.com) The largest online shopping site and one of the most widely known e-commerce sites on the Web. Founded by Jeff Bezos in 1995, it had 11 employees by year's end. Within four years, it had more than 1,600 employees and four million customers. rated the no. 1 place to save money on the internet; more than 1 million registered users and 1.5 million listings across auctions, zShops and sothebys.amazon.com Fueled by strong sales in its new consumer electronics store, Amazon.com, Inc. (Nasdaq:AMZN AMZN Amazon.com (NASDAQ symbol) ) today announced that net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the fourth quarter of 1999 were $676 million, an increase of 167 percent over net sales of $253 million for the fourth quarter of 1998. Pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for the fourth quarter of 1999 was $175 million, compared to a pro forma operating loss of $18 million in the fourth quarter of 1998. Fourth-quarter pro forma net loss of $185 million, or $0.55 per share, compared with a pro forma net loss of $22 million, or $0.07 per share, in the fourth quarter of 1998. Net sales for all of 1999 were $1.64 billion, a 169 percent increase over net sales of $610 million reported for all of 1998. Pro forma net loss for 1999 was $390 million, or $1.19 per share, compared with a pro forma net loss in 1998 of $74 million, or $0.25 per share. Amazon.com announced that cumulative customer accounts increased by 3.8 million during the fourth quarter to more than 16.9 million at December December: see month. 31, 1999, an increase of more than 170 percent from 6.2 million customer accounts at December 31, 1998. Cumulative customer accounts now stand at over 17 million. Repeat customer orders represented more than 73 percent of orders in the fourth quarter, up from 72 percent in the previous quarter. Among new initiatives, Amazon.com opened five new retail stores around the world during the quarter, along with its sothebys.amazon.com service. As recently as 19 months ago, Amazon.com's U.S. Books business represented 100 percent of Amazon.com's sales. Despite 66 percent year-over-year revenue growth, U.S. Books accounted for less than half of total company sales in the quarter as customers around the world chose Amazon.com for an increasingly wide array of products. &uot;This was our fastest sequential growth as a public company, and we are grateful that so many customers chose Amazon.com for such a broad range of products,&uot; said Jeff Bezos Jeffrey Preston Bezos (born January 12, 1964 , Albuquerque ) is the founder, president, chief executive officer, and chairman of the board of Amazon.com. Bezos, a Phi Beta Kappa graduate of Princeton University, worked as a financial analyst for D. E. Shaw & Co. , Amazon.com founder and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . &uot;We did a good job delivering for customers this holiday. The last order, just under the wire, was placed by a customer at 8:05 p.m. on December 23, left our dock at 1:05 a.m. on December 24, and was delivered to the customer in Honolulu Honolulu (hŏn'əl  `l, hōnō–), city (1990 pop. at 3:55 p.m.
on December 24. It was a Deluxe de·luxe also de luxe adj. Particularly elegant and luxurious; sumptuous: deluxe accommodations; a de luxe automobile. adv. Scrabble Scrabble Game in which two to four players compete in forming words with lettered wooden tiles on a 225-square board. Words spelled out by letters on the tiles interlock like words in a crossword puzzle. Words are scored by adding up the point values of their letters. set.&uot; &uot;This holiday season, Amazon.com made sure it did the best thing it could do in building a long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. franchise and ensuring shareholder return - we delivered for our customers,&uot; said Joe Galli
Galli (singular Gallus , Amazon.com president and COO (Cell Of Origin) See mobile positioning. . &uot;In 2000, we expect to do even more than in 1999, while at the same time driving operational excellence and platform leverage. In addition, I'd I'd 1. Contraction of I had. 2. Contraction of I would. I'd I had or I would I'd have ~would also like to welcome our newest partners, NextCard, Ashford Ash·ford , Evelyn Born 1957. American athlete. A sprinter on five Olympic track teams, she won nine Olympic medals, including a gold medal in the 100-meter dash and three gold medals in the four-by-100-meter relay. .com, Greenlight.com, drugstore.com drugstore.com is an internet pharmacy headquartered in Bellevue, Washington. Its web operations were launched on February 24, 1999. Partnerships with other companies allow customers to pick up prescriptions at Rite Aid stores, enables drugstore. , Audible A protected MP3 file format from the Audible.com audio download service. See Audible.com. , and living.com.&uot; Regarding Amazon.com's ongoing expansion, Warren Jenson Jenson is a surname, and may refer to:
The company reported that its overall fulfillment ful·fill also ful·fil tr.v. ful·filled, ful·fill·ing, ful·fills also ful·fils 1. To bring into actuality; effect: fulfilled their promises. 2. expenses were 16 percent of sales, up from 10 percent in the fourth quarter of 1998. In addition, the company reported approximately $39 million in total inventory-related charges in the fourth quarter. A live Webcast of the company's fourth quarter 1999 financial results conference call can be heard at 2:00 p.m. PST/5:00 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. today at www.amazon.com/investor-relations. The call will also be archived and available for one week. Recent Highlights Customer Experience Heads down heads down - [Sun] Concentrating, usually so heavily and for so long that everything outside the focus area is missed. See also hack mode and larval stage, although this mode is hardly confined to fledgling hackers. focus on customers helped Amazon.com continue to improve customer experience and grow brand and reach during the fourth quarter. Highlights include: -- Amazon.com was rated the No. 1 place to save money on the Internet, as rated by online shoppers in a nationwide survey by Opinion Research Corp.; -- Amazon.com was rated the No. 1 shopping destination for 42 percent of online shoppers during the holiday season, according to a survey of online shoppers by Ernst &Young; -- Amazon.com's reach climbed to 25.6 percent and unique visitors A count of how many different people access a Web site. For example, if a user leaves and comes back to the site five times during the measurement period, that person is counted as one unique visitor, but would count as five "user sessions. grew to 15.9 million in December, making it the No. 7 Web property in the month, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Media Metrix; -- Well over 99 percent of holiday orders were shipped in time to meet holiday deadlines including even orders placed as late as December 23; -- The company experienced peak shipping of approximately $16 million in one day, more than total company sales in the entire year of 1996. The ability to serve this kind of peak demand was the result of the company's commitment to serving customers and year-long investment in building out its worldwide distribution capability. Customer Spending Trends In the area of strengthening relationships with customers, Amazon.com announced that 1999 sales per customer who purchased in 1999 were $116, up from $106 for 1998. Strategic Alliances Amazon.com continued to expand the list of online partners with whom it delivers an expanded set of products and services to its customers. During the fourth quarter and so far in 2000, Amazon.com has announced partnerships with NextCard, Ashford.com, Greenlight.com, Audible, and living.com, as well as an expanded drugstore.com partnership. In aggregate, these partnerships represent more than $500 million in revenue commitments to Amazon.com over the next five years. International Expansion Just one year after launch, Amazon.com's European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. stores -- Amazon.co.uk and Amazon.de -- reached a combined annual run-rate of more than $280 million, with $71 million in combined sales in the fourth quarter, up over 360 percent from the fourth quarter of 1998. During the quarter, both stores added music to their existing bookstores, as well as local Auctions and zShops services. In the first-ever Media Metrix ratings for Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , both Amazon.de and Amazon.co.uk were ranked the No.
1 e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. site and the No. 10 most-visited site overall in their
respective countries. Over 19 percent of all Amazon.com revenues came
from customers outside the U.S. in the fourth quarter.
Books Even as Amazon.com continued to broaden its product lines, traditional stores increased their popularity with online shoppers. In the fourth quarter, book sales from the company's U.S. base extended the company's lead as the No. 1 online bookstore, with strong revenue growth to $317 million, up more than 66 percent from the fourth quarter of 1998. U.S.-based book sales have now achieved an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. run rate of $1.2 billion. From the third quarter to the fourth quarter, the growth alone (in dollar terms) of U.S.-based book sales was greater than the total fourth-quarter sales of any other online book retailer. Amazon.com's bookstore, with its large and growing community of millions of book lovers, was ranked as the No. 1 online book retailer by Forrester PowerRankings, Jupiter Communications and Gomez Advisors, Inc. Music In the fourth quarter, U.S.-based Music sales reached $78 million, up more than 136 percent from the fourth quarter of 1998, putting the business solidly over a $300 million annualized run-rate. During 1999, Amazon.com's Music Store launched an improved classical music store, enhanced recommendation features, and additional services to promote independent artists via Amazon.com Advantage. Amazon.com became the first major online music retailer to dedicate ded·i·cate tr.v. ded·i·cat·ed, ded·i·cat·ing, ded·i·cates 1. To set apart for a deity or for religious purposes; consecrate. 2. an area of its store to free, full-length song downloads from established artists and major-label performers and continues to offer the largest selection of free promotional song downloads from major label artists. Amazon.com's Music Store has dominated industry polls and was ranked as the No. 1 overall Internet music store by Gomez Advisors in its two most recent scorecards, was ranked No. 1 in the first Forrester PowerRankings(TM) for online books, music and video retailers, won the Harris Interactive Harris Interactive (NASDAQ: HPOL) is an American market research company that specializes in public opinion research using both telephone and surveys on online panels. The company is the product of a 1996 merger between the Gordon S. Black Company and Louis Harris & Associates. ecommercePulse(SM) Excellence Award for the highest overall satisfaction rating among online music and video retailers, and won the Midemnet Award 2000 for the best music shopping/digital distribution Website. DVD DVD: see digital versatile disc. DVD in full digital video disc or digital versatile disc Type of optical disc. The DVD represents the second generation of compact-disc (CD) technology. &Video U.S. DVD and Video sales grew to $64 million in the fourth quarter, up over 500 percent from the fourth quarter of 1998. Thus, in just one year, DVD &Video has grown to over $250 million in annualized sales, making it the leader in online video sales overall, in online VHS (Video Home System) A half-inch, analog videocassette recorder (VCR) format introduced by JVC in 1976 to compete with Sony's Betamax, introduced a year earlier. sales, and in online DVD sales. In fact, DVD sales now account for more than half of the revenues in this business line. Amazon.com DVD &Video was ranked the No, 1 online video store by Gomez Advisors and Forrester PowerRankings. Other recent initiatives include partnerships with theatrical studios, such as with DreamWorks, streaming video A one-way video transmission over a data network. It is widely used on the Web as well as company networks to play video clips and video broadcasts. Computers in home networks stream video to digital media hubs connected to a home theater. clips (including deleted Deleted A security that is no longer included on a specified market. Sometimes referred to as "delisted". Notes: Reasons for delisting include violating regulations, failing to meet financial specifications set out by the stock exchange and going bankrupt. scenes from The Blair Witch Project and Austin Powers: The Spy Who Shagged shag 1 n. 1. A tangle or mass, especially of rough matted hair. 2. a. A coarse long nap, as on a woolen cloth. b. Cloth having such a nap. 3. A rug with a thick rough pile. Me), and a TV partnership with Lifetime's Intimate Portraits. Toys In the fourth quarter, sales of children's products exceeded $95 million, the significant majority of which were toys. In November, Amazon.com Toys saw the launch of it Video Games See video game console. Store. Amazon.com Toys has been rated the best online toy store A toy store, or toy shop, is a retail business specializing in the services of selling toys. No longer held to the limitations of the brick and mortar outlet, the toy store has successfully created a presence within the e-commerce industry. in an MSNBC MSNBC Microsoft/National Broadcasting Company survey, beating out a number of longer-established players, and was ranked the No. 1 toys and games store by Forrester Research Forrester Research is an independent technology and market research company that provides its clients with advice about technology's impact on business and consumers. Corporate facts
Electronics Amazon.com's Electronics and Software Store saw strong growth in the fourth quarter, with sales in December alone exceeding cumulative sales during the store's first five months of operation. In December, Amazon.com's overall No. 1 product by dollar sales across all product lines was the 3Com Palm V Connected Organizer, and electronics products accounted for six of Amazon.com's top 10 revenue-generating items in the month. Despite being a new store, Amazon.com's reputation as the best place for customers to find and discover consumer electronics has been widely recognized. In December 1999, Amazon.com was ranked the No. 1 online electronics store by Gomez Advisors Inc., a leading provider of online research and analysis. In addition, Amazon.com tied for the top overall customer satisfaction rating among online electronics retailers in a December 1999 poll conducted by Harris Interactive, a leading internet-based market research and polling firm. And more than half the Amazon.com Electronics customers surveyed recently by Amazon.com described their online shopping experience as better than their experiences in physical brick and mortar See bricks and mortar. stores. Significantly, 90 percent of customers surveyed said they would buy electronics from Amazon.com again. In addition, the growth and recognition of Amazon.com's new Electronics &Software Store has led to a growing interest among manufacturers in selling electronics online. &uot;We've enjoyed successful alliances with Hewlett Packard, Xerox, Olympus, and others, and look forward to working with additional manufacturers as we bring our customers the latest and greatest in electronics,&uot; said Chris Payne, vice president and general manager of Amazon.com's Electronics Group. Home Improvement The Amazon.com Home Improvement store saw strong sales in Tools &Equipment during the holidays. The store, launched on November 10, offers Earth's largest selection of tools and equipment as well as a broad selection of other home improvement products. Developed and launched in 60 days, the Amazon.com Home Improvement Store has enabled a broad set of manufacturers, such as Porter Cable, Delta, Black &Decker/DeWalt, and Makita, to offer their entire selection of products through Amazon.com. Auctions, zShops and sothebys.amazon.com During the fourth quarter, Amazon.com's three major marketplaces, Auctions, zShops, and sothebys.amazon.com, surpassed a combined 1 million registered users and 1.5 million active listings. Amazon.com continued to integrate these services with its retail stores to deliver a better overall value and experience for customer. Examples include a partnership with DreamWorks to promote Stuart Little and American Beauty American Beauty n. A type of rose bearing large, long-stemmed purplish-red flowers. (72 auctions, averaging 27 bids per auction, total gross merchandise sales of over $25,000, yielding an average of over $400 per item) and with Oprah Winfrey “Oprah” redirects here. For the show, see The Oprah Winfrey Show. Oprah Gail Winfrey (born January 29, 1954) is the American multiple-Emmy Award winning host of The Oprah Winfrey Show, the highest-rated talk show in television history. (25 auctions, averaging 38 bids per auction, total gross merchandise sales of over $130,000, yielding an average of over $6,000 per item). In less than three months of operation sothebys.amazon.com has achieved average close rates in excess of 50 percent and average auction closing prices of over $500. Particularly strong have been special sales, such as the Halper Collection and the Secretariat Secretariat, 1970–89, thoroughbred race horse. Trained by Lucien Laurin and ridden by Ron Turcotte, Secretariat won the Kentucky Derby, Preakness, and Belmont Stakes to capture the Triple Crown in 1973. Secretariat (foaled 1970) U.S. sale, which achieved over 99 percent close rates, experienced substantially higher average closing prices, and saw a majority of items sold well above their pre-sale high estimate. About Amazon.com, Inc. Amazon.com (Amazon.com, Inc., and its subsidiaries) is the Internet's No. 1 music, No. 1 DVD and video, and No. 1 book retailer. Amazon.com (Nasdaq:AMZN) opened its virtual doors on the World Wide Web in July 1995 and today offers Earth's Biggest Selection, along with online auctions and free electronic greeting cards See e-card. . Amazon.com lists more than 18 million unique items in categories including books, CDs, toys, electronics, videos, DVDs, home improvement products, software, and video games. Through Amazon.com zShops, any business or individual can sell virtually anything to Amazon.com's more than 17 million customers, and with Amazon.com Payments, any seller can accept credit card transactions, avoiding the hassles of offline payments. The company also participates in sothebys.amazon.com, the leading auction site for guaranteed art, jewelry jewelry, personal adornments worn for ornament or utility, to show rank or wealth, or to follow superstitious custom or fashion. The most universal forms of jewelry are the necklace, bracelet, ring, pin, and earring. , and collectibles, at www.sothebys.amazon.com. Amazon.com seeks to be the world's most customer-centric company, where customers can find and discover anything they may want to buy online. Amazon.com's All Product Search scours scour, scours 1. the chemical and physical cleaning of fleece wool. 2. diarrhea. dietetic scour see dietary diarrhea. peat scour see secondary nutritional copper deficiency. the Web to help customers find merchandise that is not available at Amazon.com, Amazon.com Auctions, or Amazon.com zShops, making Amazon.com the shopping destination to find anything. Amazon.com operates two international Web sites: www.amazon.co.uk in the United Kingdom and www.amazon.de in Germany. It also operates the Internet Movie Database (www.imdb.com), the Web's comprehensive and authoritative source of information on more than 150,000 movies and entertainment programs and 500,000 cast and crewmembers dating from the birth of film in 1892 to the present. Amazon.com has invested in leading Internet retailers that are improving the lives of customers by making shopping easier and more convenient: Greenlight.com, the only company that offers car buyers the control of auto purchasing online with ongoing service and support from local dealerships, at www.greenlight.com; drugstore.com, an online retail and information source for health, beauty, wellness, personal care and pharmacy pharmacy, art of compounding and dispensing drugs and medication. The term is also applied to an establishment used for such purposes. Until modern times medication was prepared and dispensed by the physician himself. In the 18th cent. , at www.drugstore.com; Pets.com, the online leader for pet products, expert information, and services, at www.pets.com; HomeGrocer.com, the first fully integrated Internet grocery-shopping and home-delivery service -- with operations in Seattle; Portland, Oregon Oregon, city, United States Oregon, city (1990 pop. 18,334), Lucas co., NW Ohio, a suburb adjacent to Toledo, on Lake Erie; inc. 1958. It is a port with railroad-owned and -operated docks. The city has industries producing oil, chemicals, and metal products. ; and Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, -- at www.homegrocer.com; Gear.com, which offers brand-name sporting goods Noun 1. sporting goods - sports equipment sold as a commodity commodity, trade good, good - articles of commerce sports equipment - equipment needed to participate in a particular sport at prices from 20 to 90 percent off retail, at www.gear.com; and Ashford.com, the leading Internet retailer of luxury and premium products and the Web's No. 1 retailer of watches and jewelry, at www.ashford.com. Amazon.com also has a minority interest in Della.com, which brings together leading retailers with gift registry The configuration database in all 32-bit versions of Windows that contains settings for the hardware and software in the PC it is installed in. The Registry is made up of the SYSTEM.DAT and USER.DAT files. Many settings previously stored in the WIN.INI and SYSTEM. , expert advice, and personalized per·son·al·ize tr.v. per·son·al·ized, per·son·al·iz·ing, per·son·al·iz·es 1. To take (a general remark or characterization) in a personal manner. 2. To attribute human or personal qualities to; personify. gift suggestions to help everyone give better gifts, at www.della.com; and NextCard, Inc., considered the industry's leading issuer of consumer credit on the Internet, at www.nextcard.com. Historical results of operations are preliminary and unaudited. This press release also contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , including statements regarding expectations of future profitability of the U.S. books business, sales growth, gross margin and improvement in operating loss, all of which are inherently difficult to predict. Actual results could differ materially for a variety of reasons, including 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, customer spending patterns, the mix of products sold to customers, the mix of revenues derived from products sales as compared to services, risks of inventory management, and risks of distribution and fulfillment throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. and productivity. Other risks and uncertainties include Amazon.com's limited operating history, anticipated losses, potential fluctuations in quarterly operating results, seasonality, consumer trends, competition, risks associated with the distribution center expansion, adverse consequences arising from system interruptions, risks associated with management of potential growth, risks related to auction and zShops services, risks related to fraud and Amazon.com Payments, and risks of new business areas, international expansion, business combinations, and strategic alliances. 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 Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 1998 and Quarterly Reports on Form 10-Q Form 10-Q See 10-Q. for the quarters ended March 31, 1999, June 30, 1999, and September 30, 1999. Note on Financial Presentation Financial results are prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with U.S. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . Pro forma financial results exclude amortization of goodwill and other intangibles, equity in losses of equity-method investees, stock-based compensation costs and merger, acquisition and investment-related costs. The Securities and Exchange Commission is reviewing the financial statement classification of fulfillment costs and other items by a number of e-commerce companies, including Amazon.com. Amazon.com defines fulfillment costs as costs directly attributable to the operation of its distribution centers and customer service centers, and classifies these costs in marketing and sales expense. The activities of Amazon.com's distribution centers consist of receiving, inspecting and warehousing inventories of product purchased from outside suppliers and picking, packaging and preparing customers' orders for shipment. The SEC has advised the company that it may decide to require that certain distribution center costs be classified as costs of sales. In that case, Amazon.com will reclassify Verb 1. reclassify - classify anew, change the previous classification; "The zoologists had to reclassify the mollusks after they found new species" class, classify, sort out, assort, sort, separate - arrange or order by classes or categories; "How would you any fulfillment costs as required and the company's gross margin would be correspondingly affected. Any such reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. would not impact Amazon.com's sales, operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. or loss, net profit or loss, or cash flow.
AMAZON.COM, INC.
Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
Quarter Ended Year Ended
December 31, December 31,
1999 1998 1999 1998
Net sales $676,042 $252,829 $1,639,839 $609,819
Cost of sales 588,196 199,476 1,349,194 476,155
--------- --------- --------- ---------
Gross profit 87,846 53,353 290,645 133,664
Operating expenses:
Marketing and sales 179,424 48,378 413,150 132,654
Product development 57,720 17,194 159,722 46,424
General and administrative 26,051 5,413 70,144 15,618
Stock-based compensation 14,049 299 30,618 1,889
Amortization of goodwill
and other intangibles 82,301 20,452 214,694 42,599
Merger, acquisition and
investment-related costs 2,085 1,281 8,072 3,535
--------- --------- --------- ---------
Total operating
expenses 361,630 93,017 896,400 242,719
--------- --------- --------- ---------
Loss from operations (273,784) (39,664) (605,755) (109,055)
Interest income 8,972 4,264 45,451 14,053
Interest expense (18,142) (8,622) (84,566) (26,639)
Other income (expense) (366) -- 1,671 --
--------- --------- --------- ---------
Net interest expense
and other (9,536) (4,358) (37,444) (12,586)
--------- --------- --------- ---------
Net loss before equity in
losses of equity
method investees (283,320) (44,022) (643,199) (121,641)
Equity in losses of
equity method investees (39,893) (2,405) (76,769) (2,905)
--------- --------- --------- ---------
Net loss $(323,213) $(46,427) $(719,968) $(124,546)
========= ========= ========= =========
Basic and diluted
loss per share $(0.96) $(0.15) $(2.20) $(0.42)
========= ========= ========= =========
Shares used in computation of basic
and diluted loss
per share (Note 1) 338,389 308,778 326,753 296,344
========= ========= ========= =========
Pro Forma Results (Note 2)
Pro forma loss from operations,
excluding amortization of goodwill and
other intangibles, stock-based
compensation costs and merger,
acquisition and investment-
related costs $(175,349) $(17,632) $(352,371) $(61,032)
========= ========= ========= =========
Pro forma net loss, excluding
amortization of goodwill and other
intangibles, equity in losses of
equity method investees, stock-based
compensation costs and merger,
acquisition and investment-
related costs $(184,885) $(21,990) $(389,815) $(73,618)
========= ========= ========= =========
Pro forma basic and diluted loss
per share, excluding amortization of
goodwill and other intangibles, equity
in losses of equity method investees,
stock-based compensation costs and
merger, acquisition and
investment-related costs $(0.55) $(0.07) $(1.19) $(0.25)
========= ========= ========= =========
Shares used in computation of
pro forma basic and diluted
loss per share (Note 1) 338,389 308,778 326,753 296,344
========= ========= ========= =========
Note 1: The Company effected a three-for-one stock split and
two-for-one stock split on January 4, 1999 and September 1, 1999,
respectively. Each stock split was in the form of a stock dividend to
stockholders of record on December 18, 1998 and August 12, 1999,
respectively. Accordingly, the accompanying consolidated balance
sheets and statements of operations have been restated to reflect the
splits.
Note 2: Pro forma results for the quarters and years ended
December 31, 1999 and 1998 are presented for informational purposes
only and are not prepared in accordance with generally accepted
accounting principles. These results present the operating results of
Amazon.com, excluding charges of $138.3 million and $24.4 million for
the 3-month periods ended December 31, 1999 and 1998, and $330.2
million and $50.9 million for the years ended December 31, 1999 and
1998, respectively, related to amortization of goodwill and other
intangible assets, equity in losses of equity method investees,
stock-based compensation and merger, acquisition and investment-
related costs.
AMAZON.COM, INC.
Consolidated Balance Sheets
(in thousands, except per share data)
(unaudited)
DECEMBER 31, DECEMBER 31,
1999 1998
ASSETS
Current assets:
Cash $116,962 $25,561
Marketable securities 589,226 347,884
Inventories, net 220,646 29,501
Prepaid expenses and
other current assets 85,344 21,308
---------- ----------
Total current assets 1,012,178 424,254
Fixed assets, net 317,613 29,791
Goodwill, net 534,699 174,052
Other purchased intangibles, net 195,445 4,586
Investments in equity
method investees 226,727 7,740
Other investments 144,735 --
Deferred charges and other 40,154 8,037
---------- ----------
Total assets $2,471,551 $648,460
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $463,026 $113,273
Accrued expenses and other
current liabilities 126,017 34,413
Accrued advertising 55,892 13,071
Deferred revenue 54,790 --
Interest payable 24,888 10
Current portion of long-term
debt and other 14,322 808
---------- ----------
Total current liabilities 738,935 161,575
Long-term debt and other 1,466,338 348,140
Stockholders' equity:
Preferred stock, $0.01 par value:
Authorized shares -- 150,000
Issued and outstanding
shares -- none -- --
Common stock, $0.01 par value:
Authorized shares -- 1,500,000
Issued and outstanding shares --
345,155 and 318,534 shares at
December 31, 1999 and December 31,
1998, respectively 3,452 3,186
Additional paid-in capital 1,195,540 298,537
Note receivable for common stock (1,171) (1,099)
Stock-based compensation (47,806) (1,625)
Accumulated other comprehensive
income (loss) (1,709) 1,806
Accumulated deficit (882,028) (162,060)
---------- ----------
Total stockholders' equity 266,278 138,745
---------- ----------
Total liabilities and
stockholders' equity $2,471,551 $648,460
========== ==========
Note 1: The Company effected a three-for-one stock split and
two-for-one stock split on January 4, 1999 and September 1, 1999,
respectively. Each stock split was in the form of a stock dividend to
stockholders of record on December 18, 1998 and August 12, 1999,
respectively. Accordingly, the accompanying consolidated balance
sheets and statements of operations have been restated to reflect the
splits.
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