01—Abstract
Summary
Summary of the 10-K filed February 4, 2022. Cited figures are marked; the original filing is the authoritative source.
Amazon.com, Inc.'s 2021 10-K filing highlights a year of significant revenue growth, with consolidated net sales increasing by 22% to $469.8 billiona.
This growth was driven by robust performance across all segments, particularly Amazon Web Services (AWS), which saw a 37% increase in sales. The North America and International segments also showed strong growth, up 18% and 22% respectively, despite facing challenges such as fulfillment network inefficiencies and supply chain constraints. While operating income increased to $24.9 billionb, the company experienced a notable shift in free cash flow, turning negative to $(9.1) billion in 2021, primarily due to a substantial increase in capital expenditures, particularly in technology infrastructure and fulfillment capacity.
The company's strategic priorities remain focused on long-term growth, customer obsession, and operational excellence. Amazon continues to invest heavily in technology and content, including advancements in AWS and expansion of its product and service offerings.
However, the filing also underscores significant risks, including intense competition, increasing regulatory scrutiny, global supply chain disruptions, and labor market constraints. These factors, along with ongoing impacts of the COVID-19 pandemic, are expected to influence decelerated sales growth in early 2022.
02—Key points
Key Highlights
- Consolidated net sales grew 22% year-over-year to $469.8 billion in 2021.
- AWS demonstrated exceptional growth, with net sales increasing by 37% to $62.2 billion.
- North America and International segments reported net sales of $279.8 billion and $127.8 billion respectively, with growth rates of 18% and 22%.
- Operating income increased by 8.7% to $24.9 billion in 2021, driven by AWS performance.
- Free cash flow turned negative, reaching $(9.1) billion in 2021, a significant decrease from $31.0 billion in 2020, primarily due to increased capital expenditures.
- Capital expenditures rose significantly to $55.4 billion in 2021, reflecting investments in fulfillment and technology infrastructure.
- The company faces substantial risks including intense competition, supply chain disruptions, labor market constraints, and increasing regulatory scrutiny globally.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, Amazon.com Inc kept $0.07.
- Revenue$469.82B100.0%
- Cost of revenue−$272.34B58.0%
- Gross profit$197.48B42.0%
- Operating costs−$172.60B36.7%
- Operating income$24.88B5.3%
- Interest, other & tax$8.48B1.8%
- Net income$33.36B7.1%
Where FY2021 revenue went
$469.82B- Cost of revenue: $272.34B, 58% of revenue
- Operating costs: $172.60B, 37% of revenue
- Operating income: $24.88B, 5.3% of revenue
Kept 5.3% as operating incomeOperating income $24.88B · 5.3%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 4, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $469.82B$386.06B | +21.7% |
| Cost of Revenue | $272.34B$233.31B | +16.7% |
| Gross Profit | $197.48B$152.76B | +29.3% |
| Operating Expenses | $444.94B$363.17B | +22.5% |
| Operating Income | $24.88B$22.90B | +8.6% |
| Interest Expense | $1.81B$1.65B | +9.8% |
| Net Income | $33.36B$21.33B | +56.4% |
| EPS (Basic) | $3.30$2.13 | +54.9% |
| EPS (Diluted) | $3.24$2.09 | +55.0% |
| Shares Outstanding (Basic) | 10.12B10.01B | +1.1% |
| Shares Outstanding (Diluted) | 10.30B10.20B | +1.0% |
05—Questions
Frequently Asked Questions
What was Amazon's revenue performance in 2021?
Amazon's consolidated net sales increased by 22% year-over-year to $469.8 billion in 2021. The AWS segment led the growth with a 37% increase, followed by the International segment at 22% and the North America segment at 18%.
What is the company's outlook for free cash flow?
Amazon experienced a significant decline in free cash flow, moving from a positive $31.0 billion in 2020 to a negative $(9.1) billion in 2021. This was primarily driven by a substantial increase in capital expenditures, particularly in fulfillment operations and technology infrastructure to support continued growth. Management anticipates continued investment in these areas.
What are the primary risks highlighted in the 10-K filing?
Key risks identified include intense and evolving competition across all business segments, significant operational challenges related to supply chain disruptions and labor market constraints, increasing regulatory scrutiny globally (including antitrust investigations), and the inherent volatility of foreign exchange rates impacting international operations. The company also notes risks associated with its expansion into new products, services, and geographic regions.
How did Amazon's capital expenditures change in 2021?
Capital expenditures saw a significant increase, rising from $35.0 billion in 2020 to $55.4 billion in 2021. This surge reflects Amazon's strategic investments in expanding its fulfillment network, data centers, and technology infrastructure to support ongoing business growth and enhance customer experience.
06—Continue