Summary
Amazon's third quarter 2021 results showed continued top-line growth, with total net sales increasing by 15% year-over-year to $110.8 billion. This growth was driven by strong performance in AWS, which saw sales rise 39%, and a notable 16% increase in international sales. However, operating income declined by 22% to $4.9 billion, primarily due to increased shipping and fulfillment costs, wage inflation, and other operational inefficiencies, particularly impacting the North America segment which saw its operating income drop significantly. The company continues to invest heavily in its infrastructure, with capital expenditures remaining substantial. While net income saw a year-over-year decrease for the quarter, the nine-month year-to-date performance remained strong, reflecting the company's long-term growth trajectory. Management anticipates a deceleration in net sales growth for the fourth quarter of 2021, forecasting between 4% and 12% growth, and projects a significant decrease in operating income, highlighting ongoing cost pressures and macroeconomic uncertainties.
Financial Highlights
52 data points| Revenue | $110.81B |
| Cost of Revenue | $62.93B |
| Gross Profit | $47.88B |
| Operating Expenses | $105.96B |
| Operating Income | $4.85B |
| Interest Expense | $493.00M |
| Net Income | $3.16B |
| EPS (Basic) | $0.31 |
| EPS (Diluted) | $0.31 |
| Shares Outstanding (Basic) | 10.13B |
| Shares Outstanding (Diluted) | 10.31B |
Key Highlights
- 1Total net sales grew 15% to $110.8 billion in Q3 2021, compared to $96.1 billion in Q3 2020.
- 2AWS revenue increased by a robust 39% year-over-year to $16.1 billion, demonstrating continued cloud market leadership.
- 3International net sales saw a strong 16% increase to $29.1 billion, indicating recovery and growth in global markets.
- 4Operating income decreased by 22% to $4.9 billion in Q3 2021, impacted by higher operating expenses, particularly in fulfillment and shipping.
- 5North America segment operating income saw a significant decrease of 61% to $880 million, largely due to increased costs.
- 6Free cash flow for the trailing twelve months ended September 30, 2021, was significantly down to $2.6 billion from $29.5 billion in the prior year period, reflecting increased investments and working capital changes.
- 7The company guided for a net sales growth of 4%-12% and a substantial decrease in operating income for Q4 2021, signaling expected continued cost pressures.