10-QPeriod: Q2 FY2024

AMAZON COM INC Quarterly Report for Q2 Ended Jun 30, 2024

Filed August 2, 2024For Securities:AMZN

Summary

Amazon.com, Inc. (AMZN) reported robust financial performance for the second quarter and first half of 2024, demonstrating significant growth across key segments. Total net sales rose by 10% year-over-year in Q2 2024, reaching $147.98 billion, and increased by 11% for the first half to $291.29 billion. This growth was driven by strong performance in North America, a turnaround in the International segment to profitability, and continued impressive expansion in Amazon Web Services (AWS). Profitability saw a substantial improvement, with operating income more than doubling year-over-year in Q2 2024 to $14.67 billion and increasing by over 140% for the first half to $29.98 billion. This enhanced profitability is attributed to increased sales across segments, improved operational efficiencies, and a favorable impact from a change in the estimated useful lives of servers, partially offset by investments in technology infrastructure. The company's financial position remains strong, with substantial cash and marketable securities, and continued positive operating cash flow generation.

Financial Highlights

51 data points
Beta

Revenue

$147.98B

50.1% Gross Margin

Net Income

$13.48B

9.1% Net Margin

EPS (Diluted)

$1.26

Total Assets

$554.82B

Cash & Equivalents

$71.18B

Free Cash Flow

$25.28B

Financial Statements
Beta
Revenue$147.98B
Cost of Revenue$73.78B
Gross Profit$74.19B
Operating Expenses$133.31B
Operating Income$14.67B
Net Income$13.48B
EPS (Basic)$1.29
EPS (Diluted)$1.26
Shares Outstanding (Basic)10.45B
Shares Outstanding (Diluted)10.71B

Key Highlights

  • 1Total net sales increased by 10% to $147.98 billion in Q2 2024 and by 11% to $291.29 billion for the first six months of 2024, year-over-year.
  • 2Operating income surged by 91% to $14.67 billion in Q2 2024 and by 141% to $29.98 billion for the first six months of 2024, year-over-year.
  • 3AWS demonstrated robust growth, with net sales up 19% to $26.28 billion in Q2 2024 and 18% to $51.32 billion for the first six months of 2024.
  • 4The International segment returned to profitability, reporting an operating income of $273 million in Q2 2024, a significant improvement from a $895 million loss in the prior year.
  • 5Free cash flow significantly improved, reaching $52.97 billion for the twelve months ended June 30, 2024, compared to $7.88 billion for the prior year period.
  • 6Net income more than doubled in Q2 2024 to $13.49 billion, or $1.26 per diluted share, compared to $6.75 billion, or $0.65 per diluted share, in Q2 2023.
  • 7The company updated its Q3 2024 guidance, expecting net sales between $154.0 billion and $158.5 billion (8-11% growth) and operating income between $11.5 billion and $15.0 billion.

Frequently Asked Questions

Amazon's total net sales increased by 10% to $147.98 billion in the second quarter of 2024, compared to $134.38 billion in the same period of 2023. This growth was primarily driven by strong performance across its North America and AWS segments, with the International segment also showing a return to profitability.

The substantial increase in operating income was driven by several factors, including higher sales across all segments, improved operational efficiencies, and a reduction in depreciation and amortization expense due to a change in the estimated useful life of servers. Increased advertising and subscription service sales also contributed positively.

AWS continues to be a strong growth engine for Amazon. In the second quarter of 2024, AWS net sales grew by 19% year-over-year to $26.28 billion, and operating income increased significantly, reflecting continued customer demand for cloud services.

For the third quarter of 2024, Amazon expects net sales to be between $154.0 billion and $158.5 billion, representing an 8% to 11% growth rate compared to the third quarter of 2023. Operating income is projected to be between $11.5 billion and $15.0 billion.