AMAZON.COM, INC.

Table of Contents

(Mark One)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________

FORM 10-Q

____________________________________

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

For the quarterly period ended March 31, 2020 or

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

1934

For the transition period from

to

.

Commission File No. 000-22513

____________________________________

, INC.

(Exact name of registrant as specified in its charter) ____________________________________

Delaware

91-1646860

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

410 Terry Avenue North, Seattle, Washington 98109-5210

(206) 266-1000

(Address and telephone number, including area code, of registrant's principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Common Stock, par value $.01 per share

AMZN

Nasdaq Global Select Market

____________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the

preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past

90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

498,776,032 shares of common stock, par value $0.01 per share, outstanding as of April 22, 2020

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, INC. FORM 10-Q

For the Quarterly Period Ended March 31, 2020

INDEX

Item 1.

Item 2. Item 3. Item 4.

Item 1. Item 1A. Item 2. Item 3. Item 4. Item 5. Item 6. Signatures

PART I. FINANCIAL INFORMATION Financial Statements

Consolidated Statements of Cash Flows Consolidated Statements of Operations Consolidated Statements of Comprehensive Income Consolidated Balance Sheets Notes to Consolidated Financial Statements Management's Discussion and Analysis of Financial Condition and Results of Operations Quantitative and Qualitative Disclosures About Market Risk Controls and Procedures

PART II. OTHER INFORMATION Legal Proceedings Risk Factors Unregistered Sales of Equity Securities and Use of Proceeds Defaults Upon Senior Securities Mine Safety Disclosures Other Information Exhibits

2

Page

3 3 4 5 6 7 19 32 33

34 34 44 44 44 44 45 46

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PART I. FINANCIAL INFORMATION

Item 1.

Financial Statements

, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions) (unaudited)

Three Months Ended March 31,

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD OPERATING ACTIVITIES:

2019 $ 32,173

2020 $ 36,410

Net income Adjustments to reconcile net income to net cash from operating activities:

3,561

2,535

Depreciation and amortization of property and equipment and capitalized content costs, operating lease assets, and other Stock-based compensation Other operating expense (income), net Other expense (income), net Deferred income taxes Changes in operating assets and liabilities:

4,854 1,274

(13) (135) 415

5,362 1,757

67 565 322

Inventories Accounts receivable, net and other Accounts payable Accrued expenses and other Unearned revenue

Net cash provided by (used in) operating activities INVESTING ACTIVITIES:

719 (401) (6,384) (2,932) 888 1,846

1,392 1,262 (8,044) (2,761)

607 3,064

Purchases of property and equipment Proceeds from property and equipment sales and incentives Acquisitions, net of cash acquired, and other Sales and maturities of marketable securities Purchases of marketable securities

Net cash provided by (used in) investing activities FINANCING ACTIVITIES:

(3,290) 569

(1,169) 2,643 (6,876) (8,123)

(6,795) 1,367

(91) 11,626 (15,001) (8,894)

Proceeds from long-term debt and other Repayments of long-term debt and other Principal repayments of finance leases Principal repayments of financing obligations

Net cash provided by (used in) financing activities Foreign currency effect on cash, cash equivalents, and restricted cash Net increase (decrease) in cash, cash equivalents, and restricted cash CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD SUPPLEMENTAL CASH FLOW INFORMATION:

190 (351) (2,214)

(2) (2,377)

(12) (8,666) $ 23,507

693 (667) (2,600) (17) (2,591) (484) (8,905) $ 27,505

Cash paid for interest on long-term debt

$ 286 $ 290

Cash paid for operating leases

709

1,029

Cash paid for interest on finance leases

165

168

Cash paid for interest on financing obligations

2

22

Cash paid for income taxes, net of refunds

168

305

Assets acquired under operating leases

875

2,408

Property and equipment acquired under finance leases

2,628

2,166

Property and equipment acquired under build-to-suit arrangements

436

379

See accompanying notes to consolidated financial statements.

Twelve Months Ended March 31,

2019

2020

$ 17,616 $ 23,507

12,005

10,563

16,524 5,509

205 268 714

22,297 7,347

244 451 704

(2,815) (6,043) 7,095

(235) 1,133 34,360

(2,605) (6,018) 6,532 (1,213) 1,430 39,732

(13,619) 2,303 (3,342) 8,205

(13,506) (19,959)

(20,365) 4,970 (1,384) 31,664

(39,938) (25,053)

833

2,776

(817)

(3,000)

(7,649) (10,013)

(266)

(43)

(7,899) (10,280)

(611)

(401)

5,891

3,998

$ 23,507 $ 27,505

$ 858 709 471 142 840 875

10,972 3,336

$ 879 3,680 650 59 1,017 9,403 13,262 1,304

3

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, INC. CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per share data) (unaudited)

Net product sales Net service sales

Total net sales Operating expenses:

Cost of sales Fulfillment Technology and content Marketing General and administrative Other operating expense (income), net

Total operating expenses Operating income Interest income Interest expense Other income (expense), net

Total non-operating income (expense) Income before income taxes Provision for income taxes Equity-method investment activity, net of tax Net income Basic earnings per share Diluted earnings per share Weighted-average shares used in computation of earnings per share:

Basic Diluted

See accompanying notes to consolidated financial statements.

4

Three Months Ended March 31,

2019

2020

$

34,283 $

41,841

25,417

33,611

59,700

75,452

33,920

44,257

8,601

11,531

7,927 3,664 1,173

9,325 4,828 1,452

(5)

70

55,280

71,463

4,420 183 (366)

3,989 202 (402)

164

(406)

(19)

(606)

4,401 (836)

(4)

3,383 (744) (104)

$

3,561 $

2,535

$

7.24 $

5.09

$

7.09 $

5.01

491

498

502

506

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, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions) (unaudited)

Net income

$

Other comprehensive income (loss):

Foreign currency translation adjustments, net of tax of $(1) and $21

Net change in unrealized gains (losses) on available-for-sale debt securities:

Unrealized gains (losses), net of tax of $0 and $12

Reclassification adjustment for losses (gains) included in "Other income (expense), net," net of tax of $0 and $0

Net unrealized gains (losses) on available-for-sale debt securities

Total other comprehensive income (loss)

Comprehensive income

$

See accompanying notes to consolidated financial statements.

Three Months Ended March 31,

2019

3,561 $

2020

2,535

(8)

(874)

32 1 33 25 3,586 $

(203) --

(203) (1,077) 1,458

5

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