10-KPeriod: FY2015

AMAZON COM INC Annual Report, Year Ended Dec 31, 2015

Filed January 29, 2016For Securities:AMZN

Summary

Amazon's 2015 10-K filing reveals a company experiencing significant growth and continued investment across its diverse business segments. Net sales surged by 20% year-over-year, reaching $107 billion, demonstrating robust demand for its products and services. This growth was driven by strong performance in North America and a notable expansion in Amazon Web Services (AWS), which saw a 70% increase in sales, highlighting its strategic importance as a high-growth engine. Despite topline growth, profitability remained a focus, with income from operations increasing to $2.23 billion from $178 million in the prior year, showing improving operational efficiency. The company continued to invest heavily in technology and content, as well as fulfillment infrastructure, signaling a commitment to long-term expansion and customer experience. While facing intense competition and various operational risks, Amazon's financial position remains solid, supported by substantial cash flows from operations and a significant cash balance, positioning it to fund future growth initiatives.

Financial Highlights

54 data points
Beta

Revenue

$107.01B

33.0% Gross Margin

Net Income

$596.00M

0.6% Net Margin

EPS (Diluted)

$0.06

Total Assets

$64.75B

Cash & Equivalents

$15.89B

Free Cash Flow

$7.45B

Financial Statements
Beta
Revenue$107.01B
Cost of Revenue$71.65B
Gross Profit$35.35B
Operating Expenses$104.77B
Operating Income$2.23B
Interest Expense$459.00M
Net Income$596.00M
EPS (Basic)$0.06
EPS (Diluted)$0.06
Shares Outstanding (Basic)9.34B
Shares Outstanding (Diluted)9.54B

Key Highlights

  • 1Achieved 20% year-over-year net sales growth, reaching $107 billion in 2015.
  • 2Amazon Web Services (AWS) demonstrated exceptional growth, with sales increasing by 70% to $7.88 billion.
  • 3Income from operations saw a substantial increase, rising to $2.23 billion from $178 million in 2014, indicating improved profitability.
  • 4Significant investments in technology and content, totaling $12.54 billion, underscore the company's focus on innovation and platform development.
  • 5Fulfillment costs increased by 25% to $13.41 billion, reflecting ongoing expansion of its logistics network to support sales volume.
  • 6The company maintained a strong liquidity position with $19.8 billion in cash, cash equivalents, and marketable securities as of December 31, 2015.
  • 7Amazon reported a net income of $596 million for the year, a significant improvement from a net loss of $241 million in 2014.

Frequently Asked Questions

Amazon's net sales grew by 20% in 2015, reaching $107 billion. Key drivers included increased unit sales across its North America and International segments, fueled by efforts to reduce prices, expand product selection, and improve delivery speeds. The AWS segment also experienced substantial growth, contributing significantly to the overall net sales increase.

Amazon is demonstrating an improving ability to translate sales growth into profitability. Income from operations rose significantly to $2.23 billion in 2015 from $178 million in 2014, indicating effective cost management and operational efficiencies alongside aggressive growth investments in technology, fulfillment, and new services like AWS.

AWS is a critical growth driver for Amazon. In 2015, AWS sales grew by 70% to $7.88 billion and generated $1.86 billion in operating income, showcasing its high-margin potential and strategic importance. Its continued expansion and strong performance highlight Amazon's successful diversification beyond e-commerce into cloud computing services.

Amazon identified several key risks, including intense competition in its various business segments, the strain on resources from rapid global expansion, potential fluctuations in operating results, risks associated with international operations (including regulatory and currency fluctuations), and the operational challenges of managing its complex fulfillment network. Cybersecurity risks and the potential impact of government regulations were also emphasized.