01—Abstract
Summary
Summary of the 10-K filed January 31, 2014. Cited figures are marked; the original filing is the authoritative source.
Amazon.com, Inc. (AMZN) in its 2013 10-K filing demonstrates robust growth, with net sales increasing by 22% to $74.5 billiona.
The company continues to invest heavily in technology and infrastructure, including its Amazon Web Services (AWS) segment, which fuels long-term growth potential. Despite significant operational expenses, particularly in fulfillment and technology, Amazon maintained profitability with a net income of $274 millionb, a substantial improvement from the prior year's net loss of $39 million. The company's focus on customer-centricity, evidenced by its expansion of product selection, price competitiveness, and services like Amazon Prime, remains a core strategy for driving sales across its North America and International segments.
Investors should note the company's significant investments in capital expenditures, particularly for expanding its fulfillment network and technology infrastructure, which are crucial for supporting its rapid growth and service offerings. While the company faces intense competition and numerous risk factors, including international expansion challenges and regulatory scrutiny, its strong revenue growth and improving profitability signal a positive trajectory. The substantial cash and cash equivalents position provides flexibility for future investments and strategic initiatives.
02—Key points
Key Highlights
- Net sales grew by 22% year-over-year to $74.5 billion in 2013.
- Net income improved significantly to $274 million in 2013, a turnaround from a net loss of $39 million in 2012.
- The company continued substantial investments in technology and content, alongside infrastructure, with capital expenditures totaling $3.4 billion.
- Amazon Web Services (AWS) is a key growth driver, though specific segment profitability is not detailed in this section.
- Amazon Prime membership program is highlighted as a crucial customer loyalty and revenue driver.
- The company operated with a significant global footprint, with International segment sales representing 40% of total net sales.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2013, Amazon.com Inc kept $0.00.
- Revenue$74.45B100.0%
- Cost of revenue−$54.18B72.8%
- Gross profit$20.27B27.2%
- Operating costs−$19.53B26.2%
- Operating income$745.0M1.0%
- Interest, other & tax−$471.0M0.6%
- Net income$274.0M0.4%
Where FY2013 revenue went
$74.45B- Cost of revenue: $54.18B, 73% of revenue
- Operating costs: $19.53B, 26% of revenue
- Net income: $274.0M, 0.4% of revenue
- Interest, other & tax: $471.0M, 0.6% of revenue
Kept 0.4% as net incomeNet income $274.0M · 0.4%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2013filed January 31, 2014Financial Statements
FY2013 against FY2012
| Line item | FY2013FY2012 | Change |
|---|---|---|
| Revenue | $74.45B$61.09B | +21.9% |
| Cost of Revenue | $54.18B$45.97B | +17.9% |
| Gross Profit | $20.27B$15.12B | +34.0% |
| Operating Expenses | $73.71B$60.42B | +22.0% |
| Operating Income | $745.00M$676.00M | +10.2% |
| Interest Expense | $141.00M$92.00M | +53.3% |
| Net Income | $274.00M-$39.00M | +802.6% |
| EPS (Basic) | $0.03$-0.00 | +766.7% |
| EPS (Diluted) | $0.03$-0.00 | +755.6% |
| Shares Outstanding (Basic) | 9.14B9.06B | +0.9% |
| Shares Outstanding (Diluted) | 9.30B9.06B | +2.6% |
05—Questions
Frequently Asked Questions
What was Amazon's revenue growth and profitability in 2013?
In 2013, Amazon's net sales grew by 22% to $74.5 billion. The company achieved a net income of $274 million, a significant improvement from a net loss of $39 million in 2012.
How is Amazon investing for future growth?
Amazon is heavily investing in its technology and content, as well as expanding its infrastructure. This includes substantial capital expenditures of $3.4 billion in 2013, primarily for its fulfillment network and technology infrastructure to support services like Amazon Web Services (AWS).
What are the key business segments of Amazon?
Amazon organizes its operations into two primary geographic segments: North America and International. The North America segment includes its e-commerce operations in the U.S. and Canada, as well as AWS. The International segment encompasses its e-commerce operations in other global markets.
What are some of the primary risks highlighted by Amazon?
Key risks identified include intense competition across its diverse business lines, the strain of rapid global expansion on its resources, potential fluctuations in operating results, challenges in international market expansion, reliance on and optimization of its fulfillment centers, and significant inventory risks. Foreign exchange rate fluctuations also pose a market risk.
06—Continue