Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 18, 2017 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | AMZN | |
Entity Registrant Name | AMAZON COM INC | |
Entity Central Index Key | 1,018,724 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 477,975,499 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | $ 19,334 | $ 15,890 | $ 12,470 | $ 10,237 |
OPERATING ACTIVITIES: | ||||
Net income | 724 | 513 | 2,583 | 1,166 |
Adjustments to reconcile net income to net cash from operating activities: | ||||
Depreciation of property and equipment, including internal-use software and website development, and other amortization, including capitalized content costs | 2,435 | 1,827 | 8,725 | 6,682 |
Stock-based compensation | 792 | 544 | 3,223 | 2,257 |
Other operating expense, net | 42 | 43 | 157 | 155 |
Other expense (income), net | (40) | (50) | (10) | 108 |
Deferred income taxes | (22) | 11 | (279) | 94 |
Changes in operating assets and liabilities: | ||||
Inventories | 947 | 769 | (1,249) | (2,138) |
Accounts receivable, net and other | 994 | 412 | (2,785) | (1,784) |
Accounts payable | (6,865) | (5,770) | 3,935 | 2,773 |
Accrued expenses and other | (1,404) | (956) | 1,277 | 893 |
Additions to unearned revenue | 4,054 | 2,814 | 13,171 | 8,412 |
Amortization of previously unearned revenue | (3,247) | (2,110) | (11,114) | (7,055) |
Net cash provided by (used in) operating activities | (1,590) | (1,953) | 17,634 | 11,563 |
INVESTING ACTIVITIES: | ||||
Purchases of property and equipment, including internal-use software and website development, net | (1,861) | (1,179) | (7,417) | (4,897) |
Acquisitions, net of cash acquired, and other | (45) | (16) | (146) | (446) |
Sales and maturities of marketable securities | 1,910 | 1,138 | 5,505 | 3,788 |
Purchases of marketable securities | (1,620) | (636) | (8,740) | (3,741) |
Net cash provided by (used in) investing activities | (1,616) | (693) | (10,798) | (5,296) |
FINANCING ACTIVITIES: | ||||
Proceeds from long-term debt and other | 24 | 9 | 636 | 179 |
Repayments of long-term debt and other | (69) | (175) | (247) | (1,512) |
Principal repayments of capital lease obligations | (832) | (801) | (3,891) | (2,761) |
Principal repayments of finance lease obligations | (37) | (29) | (155) | (111) |
Net cash provided by (used in) financing activities | (914) | (996) | (3,657) | (4,205) |
Foreign currency effect on cash and cash equivalents | 226 | 222 | (209) | 171 |
Net increase (decrease) in cash and cash equivalents | (3,894) | (3,420) | 2,970 | 2,233 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 15,440 | 12,470 | 15,440 | 12,470 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||
Cash paid for interest on long-term debt | 4 | 2 | 292 | 310 |
Cash paid for interest on capital and finance lease obligations | 61 | 47 | 220 | 168 |
Cash paid for income taxes, net of refunds | 246 | 139 | 520 | 357 |
Assets Held under Capital Leases | ||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||
Property and equipment acquired | 1,888 | 875 | 6,717 | 4,638 |
Assets Held under Build-To-Suit Leases | ||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||
Property and equipment acquired | $ 1,200 | $ 351 | $ 2,057 | $ 793 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Net product sales | $ 23,734 | $ 20,581 |
Net service sales | 11,980 | 8,547 |
Total net sales | 35,714 | 29,128 |
Operating expenses | ||
Cost of sales | 22,440 | 18,866 |
Fulfillment | 4,697 | 3,687 |
Marketing | 1,920 | 1,436 |
Technology and content | 4,813 | 3,526 |
General and administrative | 795 | 497 |
Other operating expense, net | 44 | 45 |
Total operating expenses | 34,709 | 28,057 |
Operating income | 1,005 | 1,071 |
Interest income | 39 | 21 |
Interest expense | (139) | (117) |
Other income (expense), net | 48 | 81 |
Total non-operating income (expense) | (52) | (15) |
Income before income taxes | 953 | 1,056 |
Provision for income taxes | (229) | (475) |
Equity-method investment activity, net of tax | 0 | (68) |
Net income | $ 724 | $ 513 |
Basic earnings per share (in usd per share) | $ 1.52 | $ 1.09 |
Diluted earnings per share (in usd per share) | $ 1.48 | $ 1.07 |
Weighted average shares used in computation of earnings per share: | ||
Basic (in shares) | 477 | 471 |
Diluted (in shares) | 490 | 481 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Net income | $ 724 | $ 513 |
Other comprehensive income (loss): | ||
Foreign currency translation adjustments, net of tax of $(24) and ($13) | 187 | 102 |
Net change in unrealized gains (losses) on available-for-sale securities: | ||
Unrealized gains (losses), net of tax of $0 and $(1) | (2) | 6 |
Reclassification adjustment for losses (gains) included in “Other income (expense), net,” net of tax of $(1) and $0 | 3 | 1 |
Net unrealized gains (losses) on available-for-sale securities | 1 | 7 |
Total other comprehensive income (loss) | 188 | 109 |
Comprehensive income | $ 912 | $ 622 |
Consolidated Statements Of Com5
Consolidated Statements Of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Foreign currency translation adjustments, tax | $ (13) | $ (24) |
Unrealized gains (losses), tax | (1) | 0 |
Reclassification adjustment for losses (gains) included in other income (expense), net, tax | $ 0 | $ (1) |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 15,440 | $ 19,334 |
Marketable securities | 6,091 | 6,647 |
Inventories | 10,600 | 11,461 |
Accounts receivable, net and other | 7,329 | 8,339 |
Total current assets | 39,460 | 45,781 |
Property and equipment, net | 32,632 | 29,114 |
Goodwill | 3,823 | 3,784 |
Other assets | 5,054 | 4,723 |
Total assets | 80,969 | 83,402 |
Current liabilities: | ||
Accounts payable | 18,891 | 25,309 |
Accrued expenses and other | 13,054 | 13,739 |
Unearned revenue | 5,454 | 4,768 |
Total current liabilities | 37,399 | 43,816 |
Long-term debt | 7,691 | 7,694 |
Other long-term liabilities | 14,205 | 12,607 |
Commitments and contingencies (Note 3) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value: Authorized shares - 500 Issued and outstanding shares - none | 0 | 0 |
Common stock, $0.01 par value: Authorized shares - 5,000 Issued shares - 500 and 501 Outstanding shares - 477 and 478 | 5 | 5 |
Treasury stock, at cost | (1,837) | (1,837) |
Additional paid-in capital | 17,976 | 17,186 |
Accumulated other comprehensive loss | (797) | (985) |
Retained earnings | 6,327 | 4,916 |
Total stockholders’ equity | 21,674 | 19,285 |
Total liabilities and stockholders’ equity | $ 80,969 | $ 83,402 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, Authorized shares | 500,000,000 | 500,000,000 |
Preferred stock, Issued shares | 0 | 0 |
Preferred stock, Outstanding shares | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, Authorized shares | 5,000,000,000 | 5,000,000,000 |
Common stock, Issued shares | 501,000,000 | 500,000,000 |
Common stock, Outstanding shares | 478,000,000 | 477,000,000 |
Accounting Policies
Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Accounting Policies | ACCOUNTING POLICIES Unaudited Interim Financial Information We have prepared the accompanying consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These consolidated financial statements are unaudited and, in our opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of our consolidated balance sheets, operating results, and cash flows for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 2017 due to seasonal and other factors. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted in accordance with the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes in Item 8 of Part II, “Financial Statements and Supplementary Data,” of our 2016 Annual Report on Form 10-K. Principles of Consolidation The consolidated financial statements include the accounts of Amazon.com, Inc., its wholly-owned subsidiaries, and those entities in which we have a variable interest and of which we are the primary beneficiary, including certain entities in India and China and that support our seller lending financing activities (collectively, the “Company”). Intercompany balances and transactions between consolidated entities are eliminated. Use of Estimates The preparation of financial statements in conformity with GAAP requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent liabilities in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, determining the selling price of products and services in multiple element revenue arrangements and determining the amortization period of these elements, incentive discount offers, sales returns, vendor funding, stock-based compensation forfeiture rates, income taxes, valuation and impairment of investments, inventory valuation and inventory purchase commitments, collectability of receivables, valuation of acquired intangibles and goodwill, depreciable lives of property and equipment, internal-use software and website development costs, acquisition purchase price allocations, investments in equity interests, and contingencies. Actual results could differ materially from those estimates. Earnings per Share Basic earnings per share is calculated using our weighted-average outstanding common shares. Diluted earnings per share is calculated using our weighted-average outstanding common shares including the dilutive effect of stock awards as determined under the treasury stock method. In periods when we have a net loss, stock awards are excluded from our calculation of earnings per share as their inclusion would have an antidilutive effect. The following table shows the calculation of diluted shares (in millions): Three Months Ended 2016 2017 Shares used in computation of basic earnings per share 471 477 Total dilutive effect of outstanding stock awards 10 13 Shares used in computation of diluted earnings per share 481 490 Recently Adopted Accounting Pronouncements In July 2015, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) modifying the accounting for inventory. Under this ASU, the measurement principle for inventory changed from lower of cost or market value to lower of cost and net realizable value. The ASU defines net realizable value as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The ASU is applicable to inventory that is accounted for under the first-in, first-out method. We adopted this ASU in Q1 2017 with no material impact to our consolidated financial statements. In March 2016, the FASB issued an ASU amending the accounting for stock-based compensation and requiring excess tax benefits and deficiencies to be recognized as a component of income tax expense rather than equity. The inclusion of excess tax benefits and deficiencies as a component of our income tax expense will increase volatility within our provision for income taxes as the amount of excess tax benefits or deficiencies from stock-based compensation awards depends on our stock price at the date the awards vest. This guidance also requires excess tax benefits to be presented as an operating activity on the statement of cash flows and allows an entity to make an accounting policy election to either estimate expected forfeitures or to account for them as they occur. We adopted this ASU in Q1 2017 by recording the cumulative impact through an increase in retained earnings of $687 million , and we will continue to estimate expected forfeitures. Additionally, we retrospectively adjusted our consolidated statements of cash flows to reclassify excess tax benefits of $207 million and $305 million for the three months and twelve months ended March 31, 2016 from financing activities to operating activities. Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued an ASU amending revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB deferred the effective date of the revenue recognition guidance to reporting periods beginning after December 15, 2017. Early adoption is permitted for reporting periods beginning after December 15, 2016. As we evaluate the impact of this ASU, the more significant changes that we have identified relate to the timing of when we recognize revenue and the gross amount of revenue that we present. We expect timing changes to include Amazon-branded electronic devices sold through retailers, which will be recognized at the point of sale to the retailer rather than to end customers, and the unredeemed portion of our gift cards, which we will begin to recognize over the expected customer redemption period, which is substantially within nine months, rather than waiting until gift cards expire or when the likelihood of redemption becomes remote, generally two years from the date of issuance. In addition, we anticipate that certain advertising services will be classified as revenue rather than a reduction in cost of sales. We are continuing to evaluate the impact that this ASU, and related amendments and interpretive guidance, will have on our consolidated financial statements. We plan to adopt this ASU beginning in Q1 2018 with a cumulative adjustment to retained earnings as opposed to retrospectively adjusting prior periods. In February 2016, the FASB issued an ASU amending the accounting for leases. The new guidance requires the recognition of lease assets and liabilities for operating leases with terms of more than 12 months, in addition to those currently recorded, on our consolidated balance sheets. Presentation of leases within the consolidated statements of operations and consolidated statements of cash flows will be generally consistent with the current lease accounting guidance. The ASU is effective for reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact and expect the ASU will have a material impact on our consolidated financial statements, primarily to the consolidated balance sheets and related disclosures. In October 2016, the FASB issued an ASU amending the accounting for income taxes. The new guidance requires the recognition of the income tax consequences of an intercompany asset transfer, other than transfers of inventory, when the transfer occurs. For intercompany transfers of inventory, the income tax effects will continue to be deferred until the inventory has been sold to a third party. The ASU is effective for reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently evaluating the impact and expect the ASU will have a material impact on our consolidated financial statements. In November 2016, the FASB issued an ASU amending the presentation of restricted cash within the statement of cash flows. The new guidance requires that restricted cash be included within cash and cash equivalents on the statement of cash flows. The ASU is effective retrospectively for reporting periods beginning after December 15, 2017, with early adoption permitted. |
Cash, Cash Equivalents, and Mar
Cash, Cash Equivalents, and Marketable Securities | 3 Months Ended |
Mar. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Cash, Cash Equivalents, and Marketable Securities | As of December 31, 2016 , and March 31, 2017 , our cash, cash equivalents, and marketable securities primarily consisted of cash, U.S. and foreign government and agency securities, AAA-rated money market funds, and other investment grade securities. Cash equivalents and marketable securities are recorded at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: Level 1 —Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2 —Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3 —Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. We measure the fair value of money market funds and equity securities based on quoted prices in active markets for identical assets or liabilities. All other financial instruments were valued either based on recent trades of securities in inactive markets or based on quoted market prices of similar instruments and other significant inputs derived from or corroborated by observable market data. We did not hold any cash, cash equivalents, or marketable securities categorized as Level 3 assets as of December 31, 2016 , and March 31, 2017 . The following table summarizes, by major security type, our cash, cash equivalents, and marketable securities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in millions): December 31, 2016 March 31, 2017 Total Cost or Gross Gross Total Cash $ 6,883 $ 6,374 $ — $ — $ 6,374 Level 1 securities: Money market funds 11,940 9,643 — — 9,643 Equity securities 51 20 31 — 51 Level 2 securities: Foreign government and agency securities 337 282 — — 282 U.S. government and agency securities 4,816 3,705 1 (6 ) 3,700 Corporate debt securities 2,104 1,889 1 (2 ) 1,888 Asset-backed securities 353 370 1 (2 ) 369 Other fixed income securities 97 85 — — 85 $ 26,581 $ 22,368 $ 34 $ (10 ) $ 22,392 Less: Restricted cash, cash equivalents, and marketable securities (1) (600 ) (861 ) Total cash, cash equivalents, and marketable securities $ 25,981 $ 21,531 ___________________ (1) We are required to pledge or otherwise restrict a portion of our cash, cash equivalents, and marketable securities as collateral for standby and trade letters of credit, guarantees, debt, real estate leases, and amounts due to third-party sellers in certain jurisdictions. We classify cash, cash equivalents, and marketable securities with use restrictions of less than twelve months as “Accounts receivable, net and other” and of twelve months or longer as non-current “Other assets” on our consolidated balance sheets. See “Note 3 — Commitments and Contingencies.” The following table summarizes the contractual maturities of our cash equivalents and marketable fixed-income securities as of March 31, 2017 (in millions): Amortized Cost Estimated Fair Value Due within one year $ 13,191 $ 13,190 Due after one year through five years 2,411 2,407 Due after five years through ten years 197 196 Due after ten years 175 174 Total $ 15,974 $ 15,967 Actual maturities may differ from the contractual maturities because borrowers may have certain prepayment conditions. We also hold equity warrant assets giving us the right to acquire stock of other companies. As of December 31, 2016 , and March 31, 2017 , these warrants had a fair value of $223 million and $257 million , and are recorded within “Other assets” on our consolidated balance sheets. The related gain (loss) recorded in “Other income (expense), net” was $5 million and $15 million in Q1 2016 and Q1 2017 . These assets are primarily classified as Level 2 assets. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Commitments We have entered into non-cancellable operating, capital, and finance leases for equipment and office, fulfillment, sortation, delivery, data center, and renewable energy facilities. Rental expense under operating lease agreements was $322 million and $411 million for Q1 2016 and Q1 2017 . The following summarizes our principal contractual commitments, excluding open orders for purchases that support normal operations, as of March 31, 2017 (in millions): Nine Months Ended December 31, Year Ended December 31, 2017 2018 2019 2020 2021 Thereafter Total Debt principal and interest $ 1,336 $ 328 $ 1,571 $ 467 $ 1,246 $ 7,911 $ 12,859 Capital lease obligations, including interest (1) 3,488 3,609 2,254 640 279 280 10,550 Finance lease obligations, including interest (2) 183 250 254 256 264 2,102 3,309 Operating leases 1,091 1,356 1,244 1,116 988 4,025 9,820 Unconditional purchase obligations (3) 505 662 362 129 51 26 1,735 Other commitments (4) (5) 912 1,022 734 592 479 3,927 7,666 Total commitments $ 7,515 $ 7,227 $ 6,419 $ 3,200 $ 3,307 $ 18,271 $ 45,939 ___________________ (1) Excluding interest, current capital lease obligations of $4.0 billion and $4.4 billion are recorded within “Accrued expenses and other” as of December 31, 2016 , and March 31, 2017 , and $5.1 billion and $5.8 billion are recorded within “Other long-term liabilities” as of December 31, 2016 , and March 31, 2017 . (2) Excluding interest, current finance lease obligations of $144 million and $159 million are recorded within “Accrued expenses and other” as of December 31, 2016 , and March 31, 2017 , and $2.4 billion and $2.5 billion are recorded within “Other long-term liabilities” as of December 31, 2016 , and March 31, 2017 . (3) Includes unconditional purchase obligations related to long-term agreements to acquire and license digital media content that are not reflected on the consolidated balance sheets. For those agreements with variable terms, we do not estimate the total obligation beyond any minimum quantities and/or pricing as of the reporting date. Purchase obligations associated with renewal provisions solely at the option of the content provider are included to the extent such commitments are fixed or a minimum amount is specified. (4) Includes the estimated timing and amounts of payments for rent and tenant improvements associated with build-to-suit lease arrangements and equipment lease arrangements that have not been placed in service and digital media content liabilities associated with long-term digital media content assets with initial terms greater than one year. (5) Excludes $1.8 billion of accrued tax contingencies for which we cannot make a reasonably reliable estimate of the amount and period of payment, if any. Additionally, in March 2017, we signed an agreement to acquire Souq Group Ltd., an e-commerce company, for $580 million in cash, subject to adjustments. We expect to fund this acquisition with cash on hand, and we expect the acquisition to close in 2017, subject to customary closing conditions. Pledged Assets As of December 31, 2016 , and March 31, 2017 , we have pledged or otherwise restricted $715 million and $971 million of our cash, cash equivalents, and marketable securities, and certain property and equipment as collateral for standby and trade letters of credit, guarantees, debt relating to certain international operations, real estate leases, and amounts due to third-party sellers in certain jurisdictions. Other Contingencies In 2016, we determined that we processed and delivered orders of consumer products for certain individuals and entities located outside Iran covered by the Iran Threat Reduction and Syria Human Rights Act or other United States sanctions and export control laws. The consumer products included books, music, other media, apparel, home and kitchen, health and beauty, jewelry, office, consumer electronics, software, lawn and patio, grocery, and automotive products. Our review is ongoing and we have voluntarily reported these orders to the United States Treasury Department’s Office of Foreign Assets Control and the United States Department of Commerce’s Bureau of Industry and Security. We intend to cooperate fully with OFAC and BIS with respect to their review, which may result in the imposition of penalties. For additional information, see Item 5 of Part II, “Other Information — Disclosure Pursuant to Section 13(r) of the Exchange Act.” Legal Proceedings The Company is involved from time to time in claims, proceedings, and litigation, including the matters described in Item 8 of Part II, “Financial Statements and Supplementary Data — Note 7 — Commitments and Contingencies — Legal Proceedings” of our 2016 Annual Report on Form 10-K as supplemented by the following: In November 2007, an Austrian copyright collection society, Austro-Mechana, filed lawsuits against Amazon.com International Sales, Inc., Amazon EU S.à r.l., Amazon.de GmbH, Amazon.com GmbH, and Amazon Logistik in the Commercial Court of Vienna, Austria and in the District Court of Munich, Germany seeking to collect a tariff on blank digital media sold by our EU-based retail websites to customers located in Austria. In July 2008, the German court stayed the German case pending a final decision in the Austrian case. In July 2010, the Austrian court ruled in favor of Austro-Mechana and ordered us to report all sales of products to which the tariff potentially applies for a determination of damages. We contested Austro-Mechana’s claim and in September 2010 commenced an appeal in the Commercial Court of Vienna. We lost this appeal and in March 2011 commenced an appeal in the Supreme Court of Austria. In October 2011, the Austrian Supreme Court referred the case to the European Court of Justice (“ECJ”). In July 2013, the ECJ ruled that EU law does not preclude application of the tariff where certain conditions are met and directed the case back to the Austrian Supreme Court for further proceedings. In October 2013, the Austrian Supreme Court referred the case back to the Commercial Court of Vienna for further fact finding to determine whether the tariff on blank digital media meets the conditions set by the ECJ. In August 2015, the Commercial Court of Vienna ruled that the Austrian tariff regime does not meet the conditions the ECJ set and dismissed Austro-Mechana’s claims. In September 2015, Austro-Mechana appealed that judgment to the Higher Commercial Court of Vienna. In December 2015, the Higher Commercial Court of Vienna confirmed that the Austrian tariff regime does not meet the conditions the ECJ set and dismissed Austro-Mechana’s appeal. In February 2016, Austro-Mechana appealed that judgment to the Austrian Supreme Court. In March 2017, the Austrian Supreme Court ruled in favor of Austro-Mechana and referred the case back to the Commercial Court of Vienna for further proceedings. A number of additional actions have been filed making similar allegations. In December 2012, a German copyright collection society, Zentralstelle für private Überspielungsrechte (“ZPU”), filed a complaint against Amazon EU S.à r.l., Amazon Media EU S.à r.l., Amazon Services Europe S.à r.l., Amazon Payments Europe SCA, Amazon Europe Holding Technologies SCS, and Amazon Eurasia Holdings S.à r.l. in the District Court of Luxembourg seeking to collect a tariff on blank digital media sold by the Amazon.de retail website to customers located in Germany. In January 2013, a Belgian copyright collection society, AUVIBEL, filed a complaint against Amazon EU S.à r.l. in the Court of First Instance of Brussels, Belgium, seeking to collect a tariff on blank digital media sold by the Amazon.fr retail website to customers located in Belgium. In November 2013, the Belgian court ruled in favor of AUVIBEL and ordered us to report all sales of products to which the tariff potentially applies for a determination of damages. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in these matters. In December 2014, Smartflash LLC and Smartflash Technologies Limited filed a complaint against Amazon.com, Inc., Amazon.com, LLC, AMZN Mobile, LLC, Amazon Web Services, Inc. and Audible, Inc. for patent infringement in the United States District Court for the Eastern District of Texas. The complaint alleges, among other things, that Amazon Appstore, Amazon Instant Video, Amazon Music, Audible Audiobooks, the Amazon Mobile Ad Network, certain Kindle and Fire devices, Kindle e-bookstore, Amazon’s proprietary Android operating system, and the servers involved in operating Amazon Appstore, Amazon Instant Video, Amazon Music, the Fire TV app, Audible Audiobooks, Cloud Drive, Cloud Player, Amazon Web Services, and Amazon Mobile Ad Network infringe seven related U.S. Patents: Nos. 7,334,720; 7,942,317; 8,033,458; 8,061,598; 8,118,221; 8,336,772; and 8,794,516, all entitled “Data Storage and Access Systems.” The complaint seeks an unspecified amount of damages, an injunction, enhanced damages, attorneys’ fees, costs, and interest. In May 2015, the case was stayed until further notice. In March 2017, in an unrelated lawsuit, the United States Court of Appeals for the Federal Circuit entered judgment invalidating all asserted claims of U.S. Patent Nos. 7,334,720; 8,118,221; and 8,336,772. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in this matter. In November 2015, Eolas Technologies, Inc. filed a complaint against Amazon.com, Inc. in the United States District Court for the Eastern District of Texas. The complaint alleges, among other things, that the use of “interactive features” on www.amazon.com, including “search suggestions and search results,” infringes U.S. Patent No. 9,195,507, entitled “Distributed Hypermedia Method and System for Automatically Invoking External Application Providing Interaction and Display of Embedded Objects Within A Hypermedia Document.” The complaint sought a judgment of infringement together with costs and attorneys’ fees. In February 2016, Eolas filed an amended complaint seeking, among other things, an unspecified amount of damages. In February 2017, Eolas alleged in its damages report that in the event of a finding of liability Amazon could be subject to $130-$250 million in damages. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in this matter. The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and could be material to our operating results and cash flows for a particular period. In addition, for some matters for which a loss is probable or reasonably possible, an estimate of the amount of loss or range of losses is not possible and we may be unable to estimate the possible loss or range of losses that could potentially result from the application of non-monetary remedies. See also “Note 6 — Income Taxes.” |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | LONG-TERM DEBT In November 2012 and December 2014, we issued $3.0 billion and $6.0 billion of unsecured senior notes, of which $8.3 billion is outstanding, as described in the table below (collectively, the “Notes”). As of December 31, 2016 , and March 31, 2017 , the unamortized discount on the Notes was $90 million and $88 million . We also have other long-term debt with a carrying amount, including the current portion and borrowings under our credit facility, of $588 million and $577 million as of December 31, 2016 , and March 31, 2017 . The face value of our total long-term debt obligations is as follows (in millions): December 31, March 31, 2017 1.20% Notes due on November 29, 2017 (1) $ 1,000 $ 1,000 2.60% Notes due on December 5, 2019 (2) 1,000 1,000 3.30% Notes due on December 5, 2021 (2) 1,000 1,000 2.50% Notes due on November 29, 2022 (1) 1,250 1,250 3.80% Notes due on December 5, 2024 (2) 1,250 1,250 4.80% Notes due on December 5, 2034 (2) 1,250 1,250 4.95% Notes due on December 5, 2044 (2) 1,500 1,500 Credit Facility 495 500 Other long-term debt 93 77 Total debt 8,838 8,827 Less current portion of long-term debt (1,056 ) (1,049 ) Face value of long-term debt $ 7,782 $ 7,778 _____________________________ (1) Issued in November 2012, effective interest rates of the 2017 and 2022 Notes were 1.38% and 2.66% . (2) Issued in December 2014, effective interest rates of the 2019, 2021, 2024, 2034, and 2044 Notes were 2.73% , 3.43% , 3.90% , 4.92% , and 5.11% . Interest on the Notes issued in 2012 is payable semi-annually in arrears in May and November . Interest on the Notes issued in 2014 is payable semi-annually in arrears in June and December . We may redeem the Notes at any time in whole, or from time to time, in part at specified redemption prices. We are not subject to any financial covenants under the Notes. The proceeds from the Notes are used for general corporate purposes. The estimated fair value of the Notes was approximately $8.7 billion as of December 31, 2016 , and March 31, 2017 , which is based on quoted prices for our publicly-traded debt as of those dates. In October 2016, we entered into a $500 million secured revolving credit facility (“Credit Facility”) with a lender that is secured by certain seller receivables . The Credit Facility is available for a term of three years , bears interest at the London interbank offered rate (“ LIBOR ”) plus 1.65% , and has a commitment fee of 0.50% on the undrawn portion. There were $495 million and $500 million of borrowings outstanding under the Credit Facility as of December 31, 2016, and March 31, 2017, with weighted-average interest rates of 2.3% and 2.4% as of December 31, 2016, and March 31, 2017. As of December 31, 2016, and March 31, 2017, we have pledged $579 million and $588 million of our cash and seller receivables as collateral for debt related to our Credit Facility. The estimated fair value of the Credit Facility, which is based on Level 2 inputs, approximated its carrying value as of December 31, 2016, and March 31, 2017. The other debt, including the current portion, had a weighted-average interest rate of 3.4% and 2.9% as of December 31, 2016 , and March 31, 2017 . We used the net proceeds from the issuance of this debt primarily to fund certain international operations. The estimated fair value of the other long-term debt, which is based on Level 2 inputs, approximated its carrying value as of December 31, 2016 , and March 31, 2017 . In May 2016, we entered into an unsecured revolving credit facility (the “Credit Agreement”) with a syndicate of lenders that provides us with a borrowing capacity of up to $3.0 billion . The Credit Agreement has a term of three years , but it may be extended for up to three additional one-year terms if approved by the lenders . The initial interest rate applicable to outstanding balances under the Credit Agreement is LIBOR plus 0.60% , with a commitment fee of 0.05% on the undrawn portion of the credit facility, under our current credit ratings. If our credit ratings are downgraded these rates could increase to as much as LIBOR plus 1.00% and 0.09% , respectively. There were no borrowings outstanding under the credit agreements as of December 31, 2016 , and March 31, 2017 . |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity | STOCKHOLDERS’ EQUITY Stock Repurchase Activity In February 2016, the Board of Directors authorized a program to repurchase up to $5.0 billion of our common stock, with no fixed expiration. This stock repurchase authorization replaced the previous $2.0 billion stock repurchase authorization, approved by the Board of Directors in 2010. There were no repurchases of common stock in Q1 2016 or Q1 2017 . Stock Award Activity Common shares outstanding plus shares underlying outstanding stock awards totaled 497 million as of December 31, 2016 , and March 31, 2017 . These totals include all vested and unvested stock awards outstanding, including those awards we estimate will be forfeited. Stock-based compensation expense is as follows (in millions): Three Months Ended 2016 2017 Cost of sales (1) $ — $ 8 Fulfillment 116 163 Marketing 56 94 Technology and content 317 441 General and administrative 55 86 Total stock-based compensation expense $ 544 $ 792 ___________________ (1) Beginning in Q3 2016, stock-based compensation expense was recorded to cost of sales for eligible employees providing delivery services. The following table summarizes our restricted stock unit activity for the three months ended March 31, 2017 (in millions): Number of Units Weighted-Average Grant-Date Fair Value Outstanding as of December 31, 2016 19.8 $ 506 Units granted 1.2 844 Units vested (1.1 ) 335 Units forfeited (0.4 ) 541 Outstanding as of March 31, 2017 19.5 $ 536 Scheduled vesting for outstanding restricted stock units as of March 31, 2017 , is as follows (in millions): Nine Months Ended December 31, Year Ended December 31, 2017 2018 2019 2020 2021 Thereafter Total Scheduled vesting—restricted stock units 5.9 7.1 3.9 2.0 0.3 0.3 19.5 As of March 31, 2017 , there was $4.5 billion of net unrecognized compensation cost related to unvested stock-based compensation arrangements. This compensation is recognized on an accelerated basis with approximately half of the compensation expected to be expensed in the next twelve months, and has a weighted-average recognition period of 1.1 years. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Our tax provision or benefit from income taxes for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Our quarterly tax provision, and our quarterly estimate of our annual effective tax rate, is subject to significant variation due to several factors, including variability in accurately predicting our pre-tax and taxable income and loss and the mix of jurisdictions to which they relate, changes in how we do business, acquisitions (including integrations) and investments, audit-related developments, changes in our stock price, foreign currency gains (losses), tax law developments (including changes in statutes, regulations, case law, and administrative practices), and relative changes of expenses or losses for which tax benefits are not recognized. Additionally, our effective tax rate can be more or less volatile based on the amount of pre-tax income or loss. For example, the impact of discrete items and non-deductible expenses on our effective tax rate is greater when our pre-tax income is lower. For 2017 , we estimate that our effective tax rate will be favorably affected by the impact of excess tax benefits from stock-based compensation and the U.S. federal research and development credit and adversely affected by state income taxes. We will generate income and losses in lower tax jurisdictions primarily related to our European operations, which are headquartered in Luxembourg. Our income tax provision for the three months ended March 31, 2016 was $475 million . Our income tax provision for the three months ended March 31, 2017 was $229 million , which included $122 million of net discrete tax benefits primarily attributable to excess tax benefits from stock-based compensation, partially offset by the estimated impact of audit-related developments. Cash paid for income taxes, net of refunds was $139 million and $246 million in Q1 2016 and Q1 2017 . As of December 31, 2016 , and March 31, 2017 , tax contingencies were $1.7 billion and $1.8 billion . We expect the total amount of tax contingencies will grow in 2017 . In addition, changes in state, federal, and foreign tax laws may increase our tax contingencies. The timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ from the amounts accrued. It is reasonably possible that within the next 12 months we will receive additional assessments by various tax authorities or possibly reach resolution of income tax examinations in one or more jurisdictions. These assessments or settlements could result in changes to our contingencies related to positions on tax filings on prior years’ tax filings. We are under examination, or may be subject to examination, by the Internal Revenue Service (“IRS”) for the calendar year 2005 and thereafter. These examinations may lead to ordinary course adjustments or proposed adjustments to our taxes or our net operating losses with respect to years under examination as well as subsequent periods. As previously disclosed, we have received Notices of Proposed Adjustment (“NOPAs”) from the IRS for transactions undertaken in the 2005 and 2006 calendar years relating to transfer pricing with our foreign subsidiaries. The IRS is seeking to increase our U.S. taxable income by an amount that would result in additional federal tax of approximately $1.5 billion , subject to interest. On March 23, 2017, the U.S. Tax Court issued its decision regarding the issues raised in the IRS NOPAs. The Tax Court rejected the approach from the IRS NOPAs in determining transfer pricing adjustments in 2005 and 2006 for the transactions undertaken with our foreign subsidiaries and adopted, with adjustments, our suggested approach. The decision is subject to appeal. If the Tax Court decision were reversed on appeal or if the IRS were to successfully assert transfer pricing adjustments of a similar nature to the NOPAs for transactions in subsequent years, we could be subject to significant additional tax liabilities. Certain of our subsidiaries are under examination or investigation or may be subject to examination or investigation by the French Tax Administration (“FTA”) for calendar year 2006 and thereafter. These examinations may lead to ordinary course adjustments or proposed adjustments to our taxes. In September 2012, we received proposed tax assessment notices for calendar years 2006 through 2010 relating to the allocation of income between foreign jurisdictions. In June 2015, we received final tax collection notices for these years assessing additional French tax of €196 million , including interest and penalties through September 2012. We disagree with the assessment and intend to contest it vigorously. We plan to pursue all available administrative remedies, and if we are not able to resolve this matter, we plan to pursue judicial remedies. In addition to the risk of additional tax for years 2006 through 2010, if this litigation is adversely determined or if the FTA were to seek adjustments of a similar nature for subsequent years, we could be subject to significant additional tax liabilities. In addition, in October 2014, the European Commission opened a formal investigation to examine whether decisions by the tax authorities in Luxembourg with regard to the corporate income tax paid by certain of our subsidiaries comply with European Union rules on state aid. If this matter is adversely resolved, Luxembourg may be required to assess, and we may be required to pay, additional amounts with respect to current and prior periods from 2003 onwards and our taxes in the future could increase. We are also subject to taxation in various states and other foreign jurisdictions including Canada, China, Germany, India, Italy, Japan, Luxembourg, and the United Kingdom. We are under, or may be subject to, audit or examination and additional assessments by the relevant authorities in respect of these particular jurisdictions primarily for 2008 and thereafter. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION We have organized our operations into three segments: North America, International, and AWS. We allocate to segment results the operating expenses “Fulfillment,” “Marketing,” “Technology and content,” and “General and administrative” based on usage, which is generally reflected in the segment in which the costs are incurred. The majority of technology infrastructure costs are allocated to the AWS segment based on usage. The majority of the remaining non-infrastructure technology costs are incurred in the U.S. and are allocated to our North America segment. In Q1 2017, we combined stock-based compensation and “Other operating expense, net” with operating expenses in our presentation of segment results. There are no internal revenue transactions between our reportable segments. These segments reflect the way our chief operating decision maker evaluates the Company’s business performance and manages its operations. North America The North America segment primarily consists of amounts earned from retail sales of consumer products (including from sellers) and subscriptions through North America-focused websites such as www.amazon.com, www.amazon.ca, and www.amazon.com.mx. This segment includes export sales from these websites. International The International segment primarily consists of amounts earned from retail sales of consumer products (including from sellers) and subscriptions through internationally-focused websites such as www.amazon.com.au, www.amazon.com.br, www.amazon.cn, www.amazon.fr, www.amazon.de, www.amazon.in, www.amazon.it, www.amazon.co.jp, www.amazon.nl, www.amazon.es, and www.amazon.co.uk. This segment includes export sales from these internationally-focused websites (including export sales from these sites to customers in the U.S., Mexico, and Canada), but excludes export sales from our North American websites. AWS The AWS segment consists of amounts earned from global sales of compute, storage, database, and other service offerings for start-ups, enterprises, government agencies, and academic institutions. Information on reportable segments and reconciliation to consolidated net income is as follows (in millions): Three Months Ended 2016 2017 North America Net sales $ 16,996 $ 20,992 Operating expenses 16,408 20,396 Operating income $ 588 $ 596 International Net sales $ 9,566 $ 11,061 Operating expenses 9,687 11,542 Operating income (loss) $ (121 ) $ (481 ) AWS Net sales $ 2,566 $ 3,661 Operating expenses 1,962 2,771 Operating income $ 604 $ 890 Consolidated Net sales $ 29,128 $ 35,714 Operating expenses 28,057 34,709 Operating income 1,071 1,005 Total non-operating income (expense) (15 ) (52 ) Provision for income taxes (475 ) (229 ) Equity-method investment activity, net of tax (68 ) — Net income $ 513 $ 724 Net sales by groups of similar products and services is as follows (in millions): Three Months Ended 2016 2017 Net Sales: Retail products (1) $ 19,916 $ 22,826 Retail third-party seller services (2) 4,801 6,438 Retail subscription services (3) 1,300 1,939 AWS 2,566 3,661 Other (4) 545 850 Consolidated $ 29,128 $ 35,714 ____________________________ (1) Includes product sales and digital media content where we record revenue gross. We leverage our retail infrastructure to offer a wide selection of consumable and durable goods that includes electronics and general merchandise as well as media products available in both a physical and digital format, such as books, music, video, games, and software. These product sales include digital products sold on a transactional basis; digital product subscriptions that provide unlimited viewing or usage rights are included in Retail subscription services. (2) Includes commissions, related fulfillment and shipping fees, and other third-party seller services. (3) Includes annual and monthly fees associated with Amazon Prime membership, as well as audiobook, e-book, digital video, digital music, and other subscription services. (4) Includes sales not otherwise included above, such as certain advertising services and our co-branded credit card agreements. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Unaudited Interim Financial Information | Unaudited Interim Financial Information We have prepared the accompanying consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These consolidated financial statements are unaudited and, in our opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of our consolidated balance sheets, operating results, and cash flows for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 2017 due to seasonal and other factors. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted in accordance with the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes in Item 8 of Part II, “Financial Statements and Supplementary Data,” of our 2016 Annual Report on Form 10-K. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Amazon.com, Inc., its wholly-owned subsidiaries, and those entities in which we have a variable interest and of which we are the primary beneficiary, including certain entities in India and China and that support our seller lending financing activities (collectively, the “Company”). Intercompany balances and transactions between consolidated entities are eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent liabilities in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, determining the selling price of products and services in multiple element revenue arrangements and determining the amortization period of these elements, incentive discount offers, sales returns, vendor funding, stock-based compensation forfeiture rates, income taxes, valuation and impairment of investments, inventory valuation and inventory purchase commitments, collectability of receivables, valuation of acquired intangibles and goodwill, depreciable lives of property and equipment, internal-use software and website development costs, acquisition purchase price allocations, investments in equity interests, and contingencies. Actual results could differ materially from those estimates. |
Earnings per Share | Earnings per Share Basic earnings per share is calculated using our weighted-average outstanding common shares. Diluted earnings per share is calculated using our weighted-average outstanding common shares including the dilutive effect of stock awards as determined under the treasury stock method. In periods when we have a net loss, stock awards are excluded from our calculation of earnings per share as their inclusion would have an antidilutive effect. |
Recent Accounting Pronouncements | Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued an ASU amending revenue recognition guidance and requiring more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB deferred the effective date of the revenue recognition guidance to reporting periods beginning after December 15, 2017. Early adoption is permitted for reporting periods beginning after December 15, 2016. As we evaluate the impact of this ASU, the more significant changes that we have identified relate to the timing of when we recognize revenue and the gross amount of revenue that we present. We expect timing changes to include Amazon-branded electronic devices sold through retailers, which will be recognized at the point of sale to the retailer rather than to end customers, and the unredeemed portion of our gift cards, which we will begin to recognize over the expected customer redemption period, which is substantially within nine months, rather than waiting until gift cards expire or when the likelihood of redemption becomes remote, generally two years from the date of issuance. In addition, we anticipate that certain advertising services will be classified as revenue rather than a reduction in cost of sales. We are continuing to evaluate the impact that this ASU, and related amendments and interpretive guidance, will have on our consolidated financial statements. We plan to adopt this ASU beginning in Q1 2018 with a cumulative adjustment to retained earnings as opposed to retrospectively adjusting prior periods. In February 2016, the FASB issued an ASU amending the accounting for leases. The new guidance requires the recognition of lease assets and liabilities for operating leases with terms of more than 12 months, in addition to those currently recorded, on our consolidated balance sheets. Presentation of leases within the consolidated statements of operations and consolidated statements of cash flows will be generally consistent with the current lease accounting guidance. The ASU is effective for reporting periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the impact and expect the ASU will have a material impact on our consolidated financial statements, primarily to the consolidated balance sheets and related disclosures. In October 2016, the FASB issued an ASU amending the accounting for income taxes. The new guidance requires the recognition of the income tax consequences of an intercompany asset transfer, other than transfers of inventory, when the transfer occurs. For intercompany transfers of inventory, the income tax effects will continue to be deferred until the inventory has been sold to a third party. The ASU is effective for reporting periods beginning after December 15, 2017, with early adoption permitted. We are currently evaluating the impact and expect the ASU will have a material impact on our consolidated financial statements. In November 2016, the FASB issued an ASU amending the presentation of restricted cash within the statement of cash flows. The new guidance requires that restricted cash be included within cash and cash equivalents on the statement of cash flows. The ASU is effective retrospectively for reporting periods beginning after December 15, 2017, with early adoption permitted. |
Accounting Policies (Tables)
Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Calculation of Diluted Shares | The following table shows the calculation of diluted shares (in millions): Three Months Ended 2016 2017 Shares used in computation of basic earnings per share 471 477 Total dilutive effect of outstanding stock awards 10 13 Shares used in computation of diluted earnings per share 481 490 |
Cash, Cash Equivalents, and M17
Cash, Cash Equivalents, and Marketable Securities (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Fair Value by Major Security Type | The following table summarizes, by major security type, our cash, cash equivalents, and marketable securities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in millions): December 31, 2016 March 31, 2017 Total Cost or Gross Gross Total Cash $ 6,883 $ 6,374 $ — $ — $ 6,374 Level 1 securities: Money market funds 11,940 9,643 — — 9,643 Equity securities 51 20 31 — 51 Level 2 securities: Foreign government and agency securities 337 282 — — 282 U.S. government and agency securities 4,816 3,705 1 (6 ) 3,700 Corporate debt securities 2,104 1,889 1 (2 ) 1,888 Asset-backed securities 353 370 1 (2 ) 369 Other fixed income securities 97 85 — — 85 $ 26,581 $ 22,368 $ 34 $ (10 ) $ 22,392 Less: Restricted cash, cash equivalents, and marketable securities (1) (600 ) (861 ) Total cash, cash equivalents, and marketable securities $ 25,981 $ 21,531 ___________________ (1) We are required to pledge or otherwise restrict a portion of our cash, cash equivalents, and marketable securities as collateral for standby and trade letters of credit, guarantees, debt, real estate leases, and amounts due to third-party sellers in certain jurisdictions. We classify cash, cash equivalents, and marketable securities with use restrictions of less than twelve months as “Accounts receivable, net and other” and of twelve months or longer as non-current “Other assets” on our consolidated balance sheets. See “Note 3 — Commitments and Contingencies.” |
Investments Classified by Contractual Maturity Date | The following table summarizes the contractual maturities of our cash equivalents and marketable fixed-income securities as of March 31, 2017 (in millions): Amortized Cost Estimated Fair Value Due within one year $ 13,191 $ 13,190 Due after one year through five years 2,411 2,407 Due after five years through ten years 197 196 Due after ten years 175 174 Total $ 15,974 $ 15,967 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | The following summarizes our principal contractual commitments, excluding open orders for purchases that support normal operations, as of March 31, 2017 (in millions): Nine Months Ended December 31, Year Ended December 31, 2017 2018 2019 2020 2021 Thereafter Total Debt principal and interest $ 1,336 $ 328 $ 1,571 $ 467 $ 1,246 $ 7,911 $ 12,859 Capital lease obligations, including interest (1) 3,488 3,609 2,254 640 279 280 10,550 Finance lease obligations, including interest (2) 183 250 254 256 264 2,102 3,309 Operating leases 1,091 1,356 1,244 1,116 988 4,025 9,820 Unconditional purchase obligations (3) 505 662 362 129 51 26 1,735 Other commitments (4) (5) 912 1,022 734 592 479 3,927 7,666 Total commitments $ 7,515 $ 7,227 $ 6,419 $ 3,200 $ 3,307 $ 18,271 $ 45,939 ___________________ (1) Excluding interest, current capital lease obligations of $4.0 billion and $4.4 billion are recorded within “Accrued expenses and other” as of December 31, 2016 , and March 31, 2017 , and $5.1 billion and $5.8 billion are recorded within “Other long-term liabilities” as of December 31, 2016 , and March 31, 2017 . (2) Excluding interest, current finance lease obligations of $144 million and $159 million are recorded within “Accrued expenses and other” as of December 31, 2016 , and March 31, 2017 , and $2.4 billion and $2.5 billion are recorded within “Other long-term liabilities” as of December 31, 2016 , and March 31, 2017 . (3) Includes unconditional purchase obligations related to long-term agreements to acquire and license digital media content that are not reflected on the consolidated balance sheets. For those agreements with variable terms, we do not estimate the total obligation beyond any minimum quantities and/or pricing as of the reporting date. Purchase obligations associated with renewal provisions solely at the option of the content provider are included to the extent such commitments are fixed or a minimum amount is specified. (4) Includes the estimated timing and amounts of payments for rent and tenant improvements associated with build-to-suit lease arrangements and equipment lease arrangements that have not been placed in service and digital media content liabilities associated with long-term digital media content assets with initial terms greater than one year. (5) Excludes $1.8 billion of accrued tax contingencies for which we cannot make a reasonably reliable estimate of the amount and period of payment, if any. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-Term Debt Obligations | The face value of our total long-term debt obligations is as follows (in millions): December 31, March 31, 2017 1.20% Notes due on November 29, 2017 (1) $ 1,000 $ 1,000 2.60% Notes due on December 5, 2019 (2) 1,000 1,000 3.30% Notes due on December 5, 2021 (2) 1,000 1,000 2.50% Notes due on November 29, 2022 (1) 1,250 1,250 3.80% Notes due on December 5, 2024 (2) 1,250 1,250 4.80% Notes due on December 5, 2034 (2) 1,250 1,250 4.95% Notes due on December 5, 2044 (2) 1,500 1,500 Credit Facility 495 500 Other long-term debt 93 77 Total debt 8,838 8,827 Less current portion of long-term debt (1,056 ) (1,049 ) Face value of long-term debt $ 7,782 $ 7,778 _____________________________ (1) Issued in November 2012, effective interest rates of the 2017 and 2022 Notes were 1.38% and 2.66% . (2) Issued in December 2014, effective interest rates of the 2019, 2021, 2024, 2034, and 2044 Notes were 2.73% , 3.43% , 3.90% , 4.92% , and 5.11% . |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Stock-Based Compensation Expense | Stock-based compensation expense is as follows (in millions): Three Months Ended 2016 2017 Cost of sales (1) $ — $ 8 Fulfillment 116 163 Marketing 56 94 Technology and content 317 441 General and administrative 55 86 Total stock-based compensation expense $ 544 $ 792 |
Nonvested Restricted Stock Units Activity | The following table summarizes our restricted stock unit activity for the three months ended March 31, 2017 (in millions): Number of Units Weighted-Average Grant-Date Fair Value Outstanding as of December 31, 2016 19.8 $ 506 Units granted 1.2 844 Units vested (1.1 ) 335 Units forfeited (0.4 ) 541 Outstanding as of March 31, 2017 19.5 $ 536 |
Nonvested Share Activity | Scheduled vesting for outstanding restricted stock units as of March 31, 2017 , is as follows (in millions): Nine Months Ended December 31, Year Ended December 31, 2017 2018 2019 2020 2021 Thereafter Total Scheduled vesting—restricted stock units 5.9 7.1 3.9 2.0 0.3 0.3 19.5 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Revenue from External Customer [Line Items] | |
Information on reportable segments, reconciliation to consolidated net income | Information on reportable segments and reconciliation to consolidated net income is as follows (in millions): Three Months Ended 2016 2017 North America Net sales $ 16,996 $ 20,992 Operating expenses 16,408 20,396 Operating income $ 588 $ 596 International Net sales $ 9,566 $ 11,061 Operating expenses 9,687 11,542 Operating income (loss) $ (121 ) $ (481 ) AWS Net sales $ 2,566 $ 3,661 Operating expenses 1,962 2,771 Operating income $ 604 $ 890 Consolidated Net sales $ 29,128 $ 35,714 Operating expenses 28,057 34,709 Operating income 1,071 1,005 Total non-operating income (expense) (15 ) (52 ) Provision for income taxes (475 ) (229 ) Equity-method investment activity, net of tax (68 ) — Net income $ 513 $ 724 |
Net sales by groups of similar products and services | Net sales by groups of similar products and services is as follows (in millions): Three Months Ended 2016 2017 Net Sales: Retail products (1) $ 19,916 $ 22,826 Retail third-party seller services (2) 4,801 6,438 Retail subscription services (3) 1,300 1,939 AWS 2,566 3,661 Other (4) 545 850 Consolidated $ 29,128 $ 35,714 ____________________________ (1) Includes product sales and digital media content where we record revenue gross. We leverage our retail infrastructure to offer a wide selection of consumable and durable goods that includes electronics and general merchandise as well as media products available in both a physical and digital format, such as books, music, video, games, and software. These product sales include digital products sold on a transactional basis; digital product subscriptions that provide unlimited viewing or usage rights are included in Retail subscription services. (2) Includes commissions, related fulfillment and shipping fees, and other third-party seller services. (3) Includes annual and monthly fees associated with Amazon Prime membership, as well as audiobook, e-book, digital video, digital music, and other subscription services. (4) Includes sales not otherwise included above, such as certain advertising services and our co-branded credit card agreements. |
Accounting Policies Calculation
Accounting Policies Calculation of Diluted Shares (Detail) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings Per Share [Abstract] | ||
Shares used in computation of basic earnings per share | 477 | 471 |
Total dilutive effect of outstanding stock awards | 13 | 10 |
Shares used in computation of diluted earnings per share | 490 | 481 |
Accounting Policies Recent Acco
Accounting Policies Recent Accounting Pronouncements (Details) - Adjustments for New Accounting Pronouncement [Member] - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2016 | Mar. 31, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 687 | ||
Excess Tax Benefit from Share-based Compensation, decrease in net cash provided by financing activities | $ (207) | $ (305) | |
Excess Tax Benefit from Share-based Compensation, increase in net cash provided by operating activities | $ 207 | $ 305 |
Cash, Cash Equivalents, and M24
Cash, Cash Equivalents, and Marketable Securities Summary by Major Security Type Cash Cash Equivalents and Marketable Securities Measured at Fair Value on Recurring (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | |
Cash, cash equivalents and marketable securities [Line Items] | |||
Cash, Cash Equivalents, and Short-term Investments | $ 21,531 | $ 25,981 | |
Less: Restricted Cash and Cash Equivalents | [1] | (861) | (600) |
Cash | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 6,374 | ||
Gross Unrealized Gains | 0 | ||
Gross Unrealized Losses | 0 | ||
Cash, Cash Equivalents, and Short-term Investments | 6,374 | 6,883 | |
Cash, cash equivalents, and marketable securities | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 22,368 | ||
Gross Unrealized Gains | 34 | ||
Gross Unrealized Losses | (10) | ||
Cash, Cash Equivalents, and Short-term Investments | 22,392 | 26,581 | |
Level 1 Securities | Money market funds | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 9,643 | ||
Gross Unrealized Gains | 0 | ||
Gross Unrealized Losses | 0 | ||
Cash, Cash Equivalents, and Short-term Investments | 9,643 | 11,940 | |
Level 1 Securities | Equity securities | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 20 | ||
Gross Unrealized Gains | 31 | ||
Gross Unrealized Losses | 0 | ||
Cash, Cash Equivalents, and Short-term Investments | 51 | 51 | |
Level 2 Securities | Foreign government and agency securities | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 282 | ||
Gross Unrealized Gains | 0 | ||
Gross Unrealized Losses | 0 | ||
Cash, Cash Equivalents, and Short-term Investments | 282 | 337 | |
Level 2 Securities | U.S. government and agency securities | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 3,705 | ||
Gross Unrealized Gains | 1 | ||
Gross Unrealized Losses | (6) | ||
Cash, Cash Equivalents, and Short-term Investments | 3,700 | 4,816 | |
Level 2 Securities | Corporate debt securities | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 1,889 | ||
Gross Unrealized Gains | 1 | ||
Gross Unrealized Losses | (2) | ||
Cash, Cash Equivalents, and Short-term Investments | 1,888 | 2,104 | |
Level 2 Securities | Asset-backed securities | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 370 | ||
Gross Unrealized Gains | 1 | ||
Gross Unrealized Losses | (2) | ||
Cash, Cash Equivalents, and Short-term Investments | 369 | 353 | |
Level 2 Securities | Other fixed income securities | |||
Cash, cash equivalents and marketable securities [Line Items] | |||
Cost or Amortized Cost | 85 | ||
Gross Unrealized Gains | 0 | ||
Gross Unrealized Losses | 0 | ||
Cash, Cash Equivalents, and Short-term Investments | $ 85 | $ 97 | |
[1] | We are required to pledge or otherwise restrict a portion of our cash, cash equivalents, and marketable securities as collateral for standby and trade letters of credit, guarantees, debt, real estate leases, and amounts due to third-party sellers in certain jurisdictions. We classify cash, cash equivalents, and marketable securities with use restrictions of less than twelve months as “Accounts receivable, net and other” and of twelve months or longer as non-current “Other assets” on our consolidated balance sheets. See “Note 3 — Commitments and Contingencies.” |
Cash, Cash Equivalents, and M25
Cash, Cash Equivalents, and Marketable Securities Summary of Contractual Maturities of Cash Equivalent and Marketable Fixed Income Securities (Detail) $ in Millions | Mar. 31, 2017USD ($) |
Investments Classified by Contractual Maturity Date [Line Items] | |
Amortized Cost | $ 15,974 |
Estimated Fair Value | 15,967 |
Due within one year | |
Investments Classified by Contractual Maturity Date [Line Items] | |
Amortized Cost | 13,191 |
Estimated Fair Value | 13,190 |
Due after one year through five years | |
Investments Classified by Contractual Maturity Date [Line Items] | |
Amortized Cost | 2,411 |
Estimated Fair Value | 2,407 |
Due after five years through ten years | |
Investments Classified by Contractual Maturity Date [Line Items] | |
Amortized Cost | 197 |
Estimated Fair Value | 196 |
Due after ten years | |
Investments Classified by Contractual Maturity Date [Line Items] | |
Amortized Cost | 175 |
Estimated Fair Value | $ 174 |
Cash, Cash Equivalents, and M26
Cash, Cash Equivalents, and Marketable Securities Cash, Cash Equivalents, and Marketable Securities - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Investments, Warrant Assets | |||
Gain (loss) on Equity Warrant Assets | $ 15 | $ 5 | |
Level 2 Securities | |||
Investments, Warrant Assets | |||
Equity Warrant Assets | $ 257 | $ 223 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Loss Contingencies [Line Items] | |||
Rental expense under operating lease agreements | $ 411 | $ 322 | |
Capital Lease Obligations, Current | 4,400 | $ 4,000 | |
Capital Lease Obligations, Noncurrent | 5,800 | 5,100 | |
Finance Lease Obligations, Current | 159 | 144 | |
Finance Lease Obligations, Noncurrent | 2,500 | 2,400 | |
Tax contingencies | 1,800 | 1,700 | |
Purchase Obligation of Business Acquisition | 580 | ||
Pledged Assets | $ 971 | $ 715 |
Commitments and Contingencies P
Commitments and Contingencies Principal Contractual Commitments Excluding Open Orders for Inventory Purchases That Support Normal Operations (Detail) $ in Millions | Mar. 31, 2017USD ($) | |
Contractual commitments | ||
Nine Months Ended December 31, 2017 | $ 7,515 | |
Year Ended December 31, 2018 | 7,227 | |
Year Ended December 31, 2019 | 6,419 | |
Year Ended December 31, 2020 | 3,200 | |
Year Ended December 31, 2021 | 3,307 | |
Thereafter | 18,271 | |
Total | 45,939 | |
Capital lease obligations, including interest | ||
Nine Months Ended December 31, 2017 | 3,488 | |
Year Ended December 31, 2018 | 3,609 | |
Year Ended December 31, 2019 | 2,254 | |
Year Ended December 31, 2020 | 640 | |
Year Ended December 31, 2021 | 279 | |
Thereafter | 280 | |
Total | 10,550 | [1] |
Operating leases | ||
Nine Months Ended December 31, 2017 | 1,091 | |
Year Ended December 31, 2018 | 1,356 | |
Year Ended December 31, 2019 | 1,244 | |
Year Ended December 31, 2020 | 1,116 | |
Year Ended December 31, 2021 | 988 | |
Thereafter | 4,025 | |
Total | 9,820 | |
Unconditional purchase obligations | ||
Nine Months Ended December 31, 2017 | 505 | |
Year Ended December 31, 2018 | 662 | |
Year Ended December 31, 2019 | 362 | |
Year Ended December 31, 2020 | 129 | |
Year Ended December 31, 2021 | 51 | |
Thereafter | 26 | |
Total | 1,735 | [2] |
Other commitments | ||
Nine Months Ended December 31, 2017 | 912 | |
Year Ended December 31, 2018 | 1,022 | |
Year Ended December 31, 2019 | 734 | |
Year Ended December 31, 2020 | 592 | |
Year Ended December 31, 2021 | 479 | |
Thereafter | 3,927 | |
Total | 7,666 | [3],[4] |
Debt principal and interest | ||
Contractual commitments | ||
Nine Months Ended December 31, 2017 | 1,336 | |
Year Ended December 31, 2018 | 328 | |
Year Ended December 31, 2019 | 1,571 | |
Year Ended December 31, 2020 | 467 | |
Year Ended December 31, 2021 | 1,246 | |
Thereafter | 7,911 | |
Total | 12,859 | |
Finance lease obligations, including interest | ||
Contractual commitments | ||
Nine Months Ended December 31, 2017 | 183 | |
Year Ended December 31, 2018 | 250 | |
Year Ended December 31, 2019 | 254 | |
Year Ended December 31, 2020 | 256 | |
Year Ended December 31, 2021 | 264 | |
Thereafter | 2,102 | |
Total | $ 3,309 | [5] |
[1] | Excluding interest, current capital lease obligations of $4.0 billion and $4.4 billion are recorded within “Accrued expenses and other” as of December 31, 2016, and March 31, 2017, and $5.1 billion and $5.8 billion are recorded within “Other long-term liabilities” as of December 31, 2016, and March 31, 2017. | |
[2] | Includes unconditional purchase obligations related to long-term agreements to acquire and license digital media content that are not reflected on the consolidated balance sheets. For those agreements with variable terms, we do not estimate the total obligation beyond any minimum quantities and/or pricing as of the reporting date. Purchase obligations associated with renewal provisions solely at the option of the content provider are included to the extent such commitments are fixed or a minimum amount is specified. | |
[3] | Excludes $1.8 billion of accrued tax contingencies for which we cannot make a reasonably reliable estimate of the amount and period of payment, if any | |
[4] | Includes the estimated timing and amounts of payments for rent and tenant improvements associated with build-to-suit lease arrangements and equipment lease arrangements that have not been placed in service and digital media content liabilities associated with long-term digital media content assets with initial terms greater than one year. | |
[5] | Excluding interest, current finance lease obligations of $144 million and $159 million are recorded within “Accrued expenses and other” as of December 31, 2016, and March 31, 2017, and $2.4 billion and $2.5 billion are recorded within “Other long-term liabilities” as of December 31, 2016, and March 31, 2017. |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) | 3 Months Ended | |||
Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2014 | Nov. 30, 2012 | |
Debt Instrument [Line Items] | ||||
Credit Facility and Other Long Term Debt | $ 577,000,000 | $ 588,000,000 | ||
Face amount outstanding | 8,300,000,000 | |||
Unamortized discount | 88,000,000 | 90,000,000 | ||
Total estimated fair value of notes | $ 8,700,000,000 | $ 8,700,000,000 | ||
Other long-term debt, weighted average interest rate | 2.90% | 3.40% | ||
May 2016 Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Credit Agreement, maximum borrowing capacity | $ 3,000,000,000 | |||
Credit Agreement, term | 3 years | |||
Credit Agreement, term additional information | may be extended for up to three additional one-year terms if approved by the lenders | |||
Credit Agreement, variable rate basis | LIBOR | |||
Credit Agreement, borrowings outstanding | $ 0 | $ 0 | ||
May 2016 Revolving Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Credit Agreement, basis spread on variable rate | 0.60% | |||
Credit Agreement, commitment fee | 0.05% | |||
May 2016 Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Credit Agreement, basis spread on variable rate | 1.00% | |||
Credit Agreement, commitment fee | 0.09% | |||
October 2016 Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Other long-term debt, weighted average interest rate | 2.40% | 2.30% | ||
Debt Instrument, Collateral Amount | $ 588,000,000 | $ 579,000,000 | ||
Credit Agreement, maximum borrowing capacity | $ 500,000,000 | |||
Credit Agreement, term | 3 years | |||
Credit Agreement, term additional information | secured by certain seller receivables | |||
Credit Agreement, variable rate basis | LIBOR | |||
Credit Agreement, basis spread on variable rate | 1.65% | |||
Credit Agreement, commitment fee | 0.50% | |||
Credit Agreement, borrowings outstanding | $ 500,000,000 | $ 495,000,000 | ||
2014 Note | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 6,000,000,000 | |||
Interest payment frequency | semi-annually in arrears in June and December | |||
2012 Note | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 3,000,000,000 | |||
Interest payment frequency | semi-annually in arrears in May and November |
Long-Term Debt Long-Term Debt O
Long-Term Debt Long-Term Debt Obligations (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||
Long-term debt | $ 8,827 | $ 8,838 | |
Other long-term debt | 77 | 93 | |
Less current portion of long-term debt | (1,049) | (1,056) | |
Face value of long-term debt | $ 7,778 | 7,782 | |
1.20% Notes due on November 29, 2017 | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 1.20% | ||
Long-term debt | [1] | $ 1,000 | 1,000 |
Effective interest rates | 1.38% | ||
2.60% Notes due on December 5, 2019 | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 2.60% | ||
Long-term debt | [2] | $ 1,000 | 1,000 |
Effective interest rates | 2.73% | ||
3.30% Notes due on December 5, 2021 | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 3.30% | ||
Long-term debt | [2] | $ 1,000 | 1,000 |
Effective interest rates | 3.43% | ||
2.50% Notes due on November 29, 2022 | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 2.50% | ||
Long-term debt | [1] | $ 1,250 | 1,250 |
Effective interest rates | 2.66% | ||
3.80% Notes due on December 5, 2024 | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 3.80% | ||
Long-term debt | [2] | $ 1,250 | 1,250 |
Effective interest rates | 3.90% | ||
4.80% Notes due on December 5, 2034 | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 4.80% | ||
Long-term debt | [2] | $ 1,250 | 1,250 |
Effective interest rates | 4.92% | ||
4.95% Notes due on December 5, 2044 | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 4.95% | ||
Long-term debt | [2] | $ 1,500 | $ 1,500 |
Effective interest rates | 5.11% | ||
[1] | Issued in November 2012, effective interest rates of the 2017 and 2022 Notes were 1.38% and 2.66%. | ||
[2] | Issued in December 2014, effective interest rates of the 2019, 2021, 2024, 2034, and 2044 Notes were 2.73%, 3.43%, 3.90%, 4.92%, and 5.11%. |
Stockholders Equity - Additiona
Stockholders Equity - Additional Information (Detail) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |||||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Feb. 29, 2016 | Jan. 31, 2010 | ||
Stockholders Equity Note [Line Items] | ||||||
Stock-based compensation | $ 792 | $ 544 | ||||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 5,000 | 2,000 | ||||
Common shares outstanding plus shares underlying outstanding stock awards, including all stock-based awards outstanding, including estimated forfeiture | 497 | 497 | ||||
Net unrecognized compensation cost related to unvested stock-based compensation arrangements | $ 4,500 | |||||
Net unrecognized compensation cost related to unvested stock-based compensation arrangements, weighted average recognition period (in years) | 1 year 1 month | |||||
Cost of Sales [Member] | ||||||
Stockholders Equity Note [Line Items] | ||||||
Stock-based compensation | [1] | $ 8 | 0 | |||
Fulfillment | ||||||
Stockholders Equity Note [Line Items] | ||||||
Stock-based compensation | 163 | 116 | ||||
Marketing | ||||||
Stockholders Equity Note [Line Items] | ||||||
Stock-based compensation | 94 | 56 | ||||
Technology and content | ||||||
Stockholders Equity Note [Line Items] | ||||||
Stock-based compensation | 441 | 317 | ||||
General and administrative | ||||||
Stockholders Equity Note [Line Items] | ||||||
Stock-based compensation | $ 86 | $ 55 | ||||
[1] | Beginning in Q3 2016, stock-based compensation expense was recorded to cost of sales for eligible employees providing delivery services. |
Stockholders' Equity Restricted
Stockholders' Equity Restricted Stock Unit Activity (Detail) - Restricted Stock Units shares in Millions | 3 Months Ended |
Mar. 31, 2017$ / sharesshares | |
Number of units | |
Beginning balance (in shares) | shares | 19.8 |
Units granted (in shares) | shares | 1.2 |
Units vested (in shares) | shares | (1.1) |
Units forfeited (in shares) | shares | (0.4) |
Ending balance (in shares) | shares | 19.5 |
Weighted Average Grant-Date Fair Value | |
Beginning balance (in usd per share) | $ / shares | $ 506 |
Units granted (in usd per share) | $ / shares | 844 |
Units vested (in usd per share) | $ / shares | 335 |
Units forfeited (in usd per share) | $ / shares | 541 |
Ending balance (in usd per share) | $ / shares | $ 536 |
Stockholders' Equity Scheduled
Stockholders' Equity Scheduled Vesting for Outstanding Restricted Stock Units (Detail) - Restricted Stock Units shares in Millions | Mar. 31, 2017shares |
Schedule of Vesting [Line Items] | |
Nine Months Ended December 31, 2017 | 5.9 |
Year Ended December 31, 2018 | 7.1 |
Year Ended December 31, 2019 | 3.9 |
Year Ended December 31, 2020 | 2 |
Year Ended December 31, 2021 | 0.3 |
Thereafter | 0.3 |
Total | 19.5 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) € in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2017EUR (€) | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) | |
Income Taxes [Line Items] | ||||||
Provision for income taxes | $ (229) | $ (475) | ||||
Discrete tax expense (benefit) | (122) | |||||
Cash taxes paid, net of refunds | 246 | $ 139 | $ 520 | $ 357 | ||
Tax contingencies | $ 1,800 | $ 1,800 | $ 1,700 | |||
Internal Revenue Service (IRS) | ||||||
Income Taxes [Line Items] | ||||||
Description of the status of the tax examination | We are under examination, or may be subject to examination, by the Internal Revenue Service (“IRS”) for the calendar year 2005 and thereafter. | We are under examination, or may be subject to examination, by the Internal Revenue Service (“IRS”) for the calendar year 2005 and thereafter. | ||||
Tax examination, estimate of additional tax expense | $ 1,500 | |||||
France | ||||||
Income Taxes [Line Items] | ||||||
Description of the status of the tax examination | Certain of our subsidiaries are under examination or investigation or may be subject to examination or investigation by the French Tax Administration (“FTA”) for calendar year 2006 and thereafter. | Certain of our subsidiaries are under examination or investigation or may be subject to examination or investigation by the French Tax Administration (“FTA”) for calendar year 2006 and thereafter. | ||||
Tax examination, estimate of additional tax expense | € | € 196 | |||||
European Union | ||||||
Income Taxes [Line Items] | ||||||
Description of the status of the tax examination | In addition, in October 2014, the European Commission opened a formal investigation to examine whether decisions by the tax authorities in Luxembourg with regard to the corporate income tax paid by certain of our subsidiaries comply with European Union rules on state aid. | In addition, in October 2014, the European Commission opened a formal investigation to examine whether decisions by the tax authorities in Luxembourg with regard to the corporate income tax paid by certain of our subsidiaries comply with European Union rules on state aid. | ||||
Other Foreign Jurisdictions | ||||||
Income Taxes [Line Items] | ||||||
Description of the status of the tax examination | We are also subject to taxation in various states and other foreign jurisdictions including Canada, China, Germany, India, Italy, Japan, Luxembourg, and the United Kingdom. | We are also subject to taxation in various states and other foreign jurisdictions including Canada, China, Germany, India, Italy, Japan, Luxembourg, and the United Kingdom. | ||||
Income Tax Examination, Year under Examination | 2,008 | 2,008 |
Segment Information Reportable
Segment Information Reportable Segments and Reconciliation to Consolidated Net Income (Detail) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2017USD ($)Segment | Mar. 31, 2016USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2016USD ($) | |
Segment Reporting Disclosure [Line Items] | ||||
Number of Reportable Segments | Segment | 3 | |||
Net sales | $ 35,714 | $ 29,128 | ||
Operating expenses | 34,709 | 28,057 | ||
Operating income | 1,005 | 1,071 | ||
Total non-operating income (expense) | (52) | (15) | ||
Provision for income taxes | (229) | (475) | ||
Equity-method investment activity, net of tax | 0 | (68) | ||
Net income | 724 | 513 | $ 2,583 | $ 1,166 |
Operating Segments | ||||
Segment Reporting Disclosure [Line Items] | ||||
Net sales | 35,714 | 29,128 | ||
Operating expenses | 34,709 | 28,057 | ||
North America | Operating Segments | ||||
Segment Reporting Disclosure [Line Items] | ||||
Net sales | 20,992 | 16,996 | ||
Operating expenses | 20,396 | 16,408 | ||
Operating income | 596 | 588 | ||
International | Operating Segments | ||||
Segment Reporting Disclosure [Line Items] | ||||
Net sales | 11,061 | 9,566 | ||
Operating expenses | 11,542 | 9,687 | ||
Operating income | (481) | (121) | ||
AWS | Operating Segments | ||||
Segment Reporting Disclosure [Line Items] | ||||
Net sales | 3,661 | 2,566 | ||
Operating expenses | 2,771 | 1,962 | ||
Operating income | $ 890 | $ 604 |
Segment Information Net Sales o
Segment Information Net Sales of Similar Products and Services (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Revenue from External Customer [Line Items] | |||
Net sales | $ 35,714 | $ 29,128 | |
Retail Products | |||
Revenue from External Customer [Line Items] | |||
Net sales | [1] | 22,826 | 19,916 |
AWS | |||
Revenue from External Customer [Line Items] | |||
Net sales | 3,661 | 2,566 | |
Other | |||
Revenue from External Customer [Line Items] | |||
Net sales | [2] | 850 | 545 |
Third-party seller services | |||
Revenue from External Customer [Line Items] | |||
Net sales | [3] | 6,438 | 4,801 |
Retail subscription services | |||
Revenue from External Customer [Line Items] | |||
Net sales | [4] | $ 1,939 | $ 1,300 |
[1] | Includes product sales and digital media content where we record revenue gross. We leverage our retail infrastructure to offer a wide selection of consumable and durable goods that includes electronics and general merchandise as well as media products available in both a physical and digital format, such as books, music, video, games, and software. These product sales include digital products sold on a transactional basis; digital product subscriptions that provide unlimited viewing or usage rights are included in Retail subscription services. | ||
[2] | Includes sales not otherwise included above, such as certain advertising services and our co-branded credit card agreements. | ||
[3] | Includes commissions, related fulfillment and shipping fees, and other third-party seller services. | ||
[4] | Includes annual and monthly fees associated with Amazon Prime membership, as well as audiobook, e-book, digital video, digital music, and other subscription services. |