Edgar Filing: AMAZON COM INC

Form 8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

April 10, 2003
DATE OF REPORT
(DATE OF EARLIEST EVENT REPORTED)

AMAZON.COM, INC.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)


DELAWARE (STATE OR OTHER JURISDICTION OF INCORPORATION)		000-22513 (COMMISSION FILE NO.)		91-1646860 (IRS EMPLOYER IDENTIFICATION NO.)

1200 12TH AVENUE SOUTH, SUITE 1200, SEATTLE, WASHINGTON 98144

(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES, INCLUDING ZIP CODE)

(206) 266-1000

(REGISTRANT’S TELEPHONE NUMBER, INCLUDING AREA CODE)

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	ITEM 9. REGULATION FD DISCLOSURE
SIGNATURES

ITEM 9. REGULATION FD DISCLOSURE

Amazon.com, Inc. today announced its financial reporting segments for 2003: North America and International. These segments reflect changes in the way the Company evaluates its business performance and manages its operations. Historical results for 2002 and 2001 for the North America and International segments, along with certain supplemental revenue information, are presented below and are available at www.amazon.com/ir. Consolidated net sales, gross profit, income (loss) from operations and net income (loss) are not affected. Segment results for first quarter 2003 will be reported when first quarter 2003 financial results are announced on April 24, 2003.

The North America segment consists of amounts earned from retail sales of consumer products through www.amazon.com and www.amazon.ca (including from third-party sellers), from North America focused Syndicated Stores and mail-order catalogs and from non-retail activities such as North America focused Merchant.com, marketing and promotional agreements.

The International segment consists of amounts earned from retail sales of consumer products through www.amazon.co.uk, www.amazon.de, www.amazon.fr and www.amazon.co.jp (including from third-party sellers), from internationally focused Syndicated Stores and from non-retail activities such as internationally focused marketing and promotional agreements. This segment includes export sales from www.amazon.co.uk, www.amazon.de, www.amazon.fr and www.amazon.co.jp (including export sales from these sites to customers in the U.S. and Canada), but excludes export sales from www.amazon.com and www.amazon.ca.

The Company has provided supplemental revenue information within each segment for three categories: “Media,” “Electronics and other general merchandise” and “Other.” Media consists of amounts earned from retail sales from all sellers of books, music, DVD/video, magazine subscriptions, software and video games. Electronics and other general merchandise consists of amounts earned from retail sales from all sellers of items not included in Media, such as electronics, toys, home improvement, home and garden and apparel. The Other category consists of non-retail activities, such as the Merchant.com program and miscellaneous marketing and promotional agreements.

Two years of historical financial information using the new segment presentation are as follows (in thousands):


			Three Months Ended
															Year Ended
			March 31,			June 30,			September 30,			December 31,			December 31,
			2002			2002			2002			2002			2002

North America
	Net sales		$	621,303		$	586,479		$	587,004		$	966,671		$	2,761,457
	Gross profit			173,522			170,129			154,685			242,648			740,985
	Segment income			35,426			35,661			26,346			82,234			179,667
International
	Net sales			226,119			219,126			264,295			461,939			1,171,479
	Gross profit			49,603			48,038			61,482			92,511			251,633
	Segment income (loss)			(10,768	)		(9,667	)		1,146			19,724			435
Consolidated
	Net sales			847,422			805,605			851,299			1,428,610			3,932,936
	Gross profit			223,125			218,167			216,167			335,159			992,618
	Segment income			24,658			25,994			27,492			101,958			180,102
	Stock-based compensation			(10,931	)		(23,148	)		832			(35,680	)		(68,927	)
	Amortization of goodwill and
		other intangibles		(1,979	)		(1,374	)		(1,212	)		(913	)		(5,478	)
	Restructuring-related and other			(9,974	)		—			(36,757	)		5,158			(41,573	)
	Total non-operating expenses, net			(23,981	)		(93,857	)		(24,878	)		(67,172	)		(209,888	)
	Equity in losses of equity-method
		investees, net		(1,744	)		(1,168	)		(557	)		(700	)		(4,169	)
	Cumulative effect of change in
		accounting principle		801			—			—			—			801

	Net income (loss)		$	(23,150	)	$	(93,553	)	$	(35,080	)	$	2,651		$	(149,132	)

	Segment Highlights:
	Y / Y net sales growth:
		North America		9	%		9	%		17	%		13	%		12	%
		International		71			71			91			76			77
		Consolidated		21			21			33			28			26
	Y / Y gross profit growth:
		North America		12			13			15			11			13
		International		77			64			118			66			78
		Consolidated		22			21			33			22			24
	Gross margin:
		North America		28			29			26			25			27
		International		22			22			23			20			21
		Consolidated		26			27			25			23			25
	Segment operating margin:
		North America		6			6			4			9			7
		International		(5	)		(4	)		0			4			0
		Consolidated		3			3			3			7			5
	Net sales mix:
		North America		73			73			69			68			70
		International		27			27			31			32			30


			Three Months Ended
															Year Ended
			March 31,			June 30,			September 30,			December 31,			December 31,
			2001			2001			2001			2001			2001

North America
	Net sales		$	568,251		$	539,279		$	500,790		$	852,016		$	2,460,336
	Gross profit			154,547			150,355			134,029			218,298			657,229
	Segment income (loss)			(14,032	)		1,984			928			68,621			57,501
International
	Net sales			132,105			128,346			138,491			263,155			662,097
	Gross profit			28,050			29,365			28,163			55,751			141,329
	Segment loss			(34,569	)		(29,993	)		(28,000	)		(9,941	)		(102,503	)
Consolidated
	Net sales			700,356			667,625			639,281			1,115,171			3,122,433
	Gross profit			182,597			179,720			162,192			274,049			798,558
	Segment income (loss)			(48,601	)		(28,009	)		(27,072	)		58,680			(45,002	)
	Stock-based compensation			(2,916	)		(2,351	)		2,567			(1,937	)		(4,637	)
	Amortization of goodwill and
		other intangibles		(50,831	)		(50,830	)		(41,835	)		(37,537	)		(181,033	)
	Restructuring-related and other			(114,260	)		(58,650	)		(3,994	)		(4,681	)		(181,585	)
	Total non-operating expenses, net			6,175			(18,204	)		(94,558	)		(7,583	)		(114,170	)
	Equity in losses of equity-method
		investees, net		(13,175	)		(10,315	)		(4,982	)		(1,855	)		(30,327	)
	Cumulative effect of change in
		accounting principle		(10,523	)		—			—			—			(10,523	)

	Net income (loss)		$	(234,131	)	$	(168,359	)	$	(169,874	)	$	5,087		$	(567,277	)

	Segment Highlights:
	Y / Y net sales growth:
		North America		14	%		7	%		(9	%)		3	%		3	%
		International		76			75			58			82			74
		Consolidated		22			16			0			15			13
	Y / Y gross profit growth:
		North America		38			26			(10	)		10			14
		International		75			80			49			113			83
		Consolidated		43			32			(3	)		22			22
	Gross margin:
		North America		27			28			27			26			27
		International		21			23			20			21			21
		Consolidated		26			27			25			25			26
	Segment operating margin:
		North America		(2	)		0			0			8			2
		International		(26	)		(23	)		(20	)		(4	)		(15	)
		Consolidated		(7	)		(4	)		(4	)		5			(1	)
	Net sales mix:
		North America		81			81			78			76			79
		International		19			19			22			24			21

Two years of historical supplemental revenue information using the new segment presentation are as follows (in thousands):


		Three Months Ended
														Year Ended
		March 31,			June 30,			September 30,			December 31,			December 31,
		2002			2002			2002			2002			2002

North America
	Media	$	471,343		$	439,245		$	435,793		$	648,568		$	1,994,949
	Electronics and other general merchandise		127,644			130,203			133,355			289,839			681,041
	Other		22,316			17,031			17,856			28,264			85,467

			621,303			586,479			587,004			966,671			2,761,457
International
	Media		214,269			208,923			249,855			430,618			1,103,665
	Electronics and other general merchandise		11,358			9,685			13,875			30,959			65,877
	Other		492			518			565			362			1,937

			226,119			219,126			264,295			461,939			1,171,479
Consolidated
	Media		685,612			648,168			685,648			1,079,186			3,098,614
	Electronics and other general merchandise		139,002			139,888			147,230			320,798			746,918
	Other		22,808			17,549			18,421			28,626			87,404

		$	847,422		$	805,605		$	851,299		$	1,428,610		$	3,932,936

Y / Y Revenue Growth:
North America:
	Media		8	%		6	%		16	%		11	%		10	%
	Electronics and other general merchandise		11			18			21			20			18
	Other		32			13			25			7			18
International:
	Media		63			64			85			71			71
	Electronics and other general merchandise		1,054			629			327			193			308
	Other		—			—			—			(29)			280
Consolidated:
	Media		21			20			34			29			26
	Electronics and other general merchandise		20			25			30			27			26
	Other		35			16			29			7			19
Consolidated Revenue Mix:
	Media		81			80			81			76			79
	Electronics and other general merchandise		16			17			17			22			19
	Other		3			2			2			2			2


		Three Months Ended
														Year Ended
		March 31,			June 30,			September 30,			December 31,			December 31,
		2001			2001			2001			2001			2001

North America
	Media	$	436,158		$	413,555		$	376,654		$	583,808		$	1,810,175
	Electronics and other general merchandise		115,141			110,620			109,879			241,884			577,524
	Other		16,952			15,104			14,257			26,324			72,637

			568,251			539,279			500,790			852,016			2,460,336
International
	Media		131,121			127,018			135,241			252,073			645,453
	Electronics and other general merchandise		984			1,328			3,250			10,572			16,134
	Other		—			—			—			510			510

			132,105			128,346			138,491			263,155			662,097
Consolidated
	Media		567,279			540,573			511,895			835,881			2,455,628
	Electronics and other general merchandise		116,125			111,948			113,129			252,456			593,658
	Other		16,952			15,104			14,257			26,834			73,147

		$	700,356		$	667,625		$	639,281		$	1,115,171		$	3,122,433

Y / Y Revenue Growth:
North America:
	Media		4	%		2	%		(11	%)		6	%		1	%
	Electronics and other general merchandise		95			50			9			(2	)		20
	Other		(21	)		(42	)		(49	)		(9	)		(30	)
International:
	Media		75			73			54			76			70
	Electronics and other general merchandise		2,191			2,584			5,384			713			1,011
	Other		(100	)		(100	)		(100	)		1,972			249
Consolidated:
	Media		15			13			1			20			13
	Electronics and other general merchandise		96			51			12			2			23
	Other		(21	)		(42	)		(49	)		(7	)		(30	)
Consolidated Revenue Mix:
	Media		81			81			80			75			79
	Electronics and other general merchandise		17			17			18			23			19
	Other		2			2			2			2			2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	AMAZON.COM, INC. (REGISTRANT)

	By:	/s/ THOMAS J. SZKUTAK Thomas J. Szkutak Senior Vice President and Chief Financial Officer

Dated: April 10, 2003

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