Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 17, 2019 | |
Document And Entity Information [Abstract] | ||
Document Transition Report | false | |
Document Quarterly Report | true | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | AMAZON COM INC | |
Entity Central Index Key | 0001018724 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Address, Postal Zip Code | 98109-5210 | |
Entity Address, Address Line One | 410 Terry Avenue North | |
Entity Address, City or Town | Seattle, | |
Entity Address, State or Province | WA | |
Entity Small Business | false | |
Entity File Number | 000-22513 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 91-1646860 | |
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | AMZN | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 494,656,015 | |
City Area Code | 206 | |
Local Phone Number | 266-1000 | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Cash Flows [Abstract] | ||||||
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | $ 23,507 | $ 17,616 | $ 32,173 | $ 21,856 | $ 20,536 | $ 13,851 |
OPERATING ACTIVITIES: | ||||||
Net income | 2,625 | 2,534 | 6,186 | 4,163 | 12,096 | 6,275 |
Adjustments to reconcile net income to net cash from operating activities: | ||||||
Depreciation and amortization of property and equipment and capitalized content costs, operating lease assets, and other | 5,202 | 3,630 | 10,056 | 7,301 | 18,097 | 13,711 |
Stock-based compensation | 1,971 | 1,468 | 3,245 | 2,651 | 6,012 | 4,914 |
Other operating expense (income), net | 80 | 85 | 67 | 141 | 200 | 240 |
Other expense (income), net | (7) | 110 | (142) | (75) | 152 | (207) |
Deferred income taxes | 105 | (139) | 520 | 3 | 958 | (380) |
Changes in operating assets and liabilities: | ||||||
Inventories | (2,100) | (1,090) | (1,381) | 1,130 | (3,826) | (2,717) |
Accounts receivable, net and other | (2,193) | (1,364) | (2,594) | (336) | (6,873) | (4,859) |
Accounts payable | 3,668 | 2,703 | (2,716) | (7,513) | 8,060 | 4,364 |
Accrued expenses and other | (623) | (205) | (3,556) | (2,430) | (653) | (491) |
Unearned revenue | 390 | (283) | 1,278 | 623 | 1,806 | 943 |
Net cash provided by (used in) operating activities | 9,118 | 7,449 | 10,963 | 5,658 | 36,029 | 21,793 |
INVESTING ACTIVITIES: | ||||||
Purchases of property and equipment | (3,562) | (3,243) | (6,852) | (6,341) | (13,938) | (13,035) |
Proceeds from property and equipment incentives | 919 | 294 | 1,488 | 665 | 2,927 | 1,663 |
Acquisitions, net of cash acquired, and other | (117) | (866) | (1,285) | (879) | (2,592) | (14,173) |
Sales and maturities of marketable securities | 5,161 | 1,660 | 7,804 | 4,337 | 11,706 | 10,034 |
Purchases of marketable securities | (9,950) | (537) | (16,827) | (1,007) | (22,919) | (8,173) |
Net cash provided by (used in) investing activities | (7,549) | (2,692) | (15,672) | (3,225) | (24,816) | (23,684) |
FINANCING ACTIVITIES: | ||||||
Proceeds from long-term debt and other | 283 | 96 | 473 | 221 | 1,020 | 16,380 |
Repayments of long-term debt and other | (112) | (149) | (464) | (351) | (781) | (1,564) |
Principal repayments of finance leases | (2,327) | (1,284) | (4,541) | (3,297) | (8,693) | (6,037) |
Principal repayments of financing obligations | (2) | (57) | (3) | (129) | (211) | (244) |
Net cash provided by (used in) financing activities | (2,158) | (1,394) | (4,535) | (3,556) | (8,665) | 8,535 |
Foreign currency effect on cash, cash equivalents, and restricted cash | 47 | (443) | 36 | (197) | (119) | 41 |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (542) | 2,920 | (9,208) | (1,320) | 2,429 | 6,685 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | 22,965 | 20,536 | 22,965 | 20,536 | 22,965 | 20,536 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||
Cash paid for interest on long-term debt | 147 | 168 | 433 | 450 | 837 | 628 |
Cash paid for operating leases | 838 | 0 | 1,547 | 0 | 1,547 | 0 |
Cash paid for interest on finance leases | 150 | 85 | 315 | 159 | 536 | 273 |
Cash paid for interest on financing obligations | 4 | 40 | 5 | 95 | 105 | 176 |
Cash paid for income taxes, net of refunds | 283 | 300 | 451 | 813 | 822 | 1,077 |
Assets acquired under operating leases | 2,220 | 0 | 3,094 | 0 | 3,094 | 0 |
Property and equipment acquired under finance leases | 3,307 | 2,335 | 5,935 | 4,605 | 11,944 | 9,631 |
Property and equipment acquired under build-to-suit arrangements | $ 283 | $ 795 | $ 719 | $ 1,536 | $ 2,825 | $ 3,128 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Total net sales | $ 63,404 | $ 52,886 | $ 123,104 | $ 103,928 |
Operating expenses: | ||||
Cost of sales | 36,337 | 30,632 | 70,257 | 61,367 |
Fulfillment | 9,271 | 7,932 | 17,872 | 15,724 |
Marketing | 4,291 | 2,901 | 7,955 | 5,600 |
Technology and content | 9,065 | 7,247 | 16,991 | 14,006 |
General and administrative | 1,270 | 1,111 | 2,444 | 2,177 |
Other operating expense (income), net | 86 | 80 | 81 | 143 |
Total operating expenses | 60,320 | 49,903 | 115,600 | 99,017 |
Operating income | 3,084 | 2,983 | 7,504 | 4,911 |
Interest income | 215 | 94 | 398 | 173 |
Interest expense | (383) | (343) | (749) | (673) |
Other income (expense), net | (27) | (129) | 138 | 109 |
Total non-operating income (expense) | (195) | (378) | (213) | (391) |
Income before income taxes | 2,889 | 2,605 | 7,291 | 4,520 |
Provision for income taxes | (257) | (74) | (1,094) | (361) |
Equity-method investment activity, net of tax | (7) | 3 | (11) | 4 |
Net income | $ 2,625 | $ 2,534 | $ 6,186 | $ 4,163 |
Basic earnings per share | $ 5.32 | $ 5.21 | $ 12.57 | $ 8.58 |
Diluted earnings per share | $ 5.22 | $ 5.07 | $ 12.31 | $ 8.34 |
Weighted-average shares used in computation of earnings per share: | ||||
Basic (in shares) | 493 | 486 | 492 | 485 |
Diluted (in shares) | 503 | 500 | 503 | 499 |
Product [Member] | ||||
Total net sales | $ 35,856 | $ 31,864 | $ 70,139 | $ 63,468 |
Service [Member] | ||||
Total net sales | $ 27,548 | $ 21,022 | $ 52,965 | $ 40,460 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 2,625 | $ 2,534 | $ 6,186 | $ 4,163 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments, net of tax of $(1), $(6), $17, and $(8) | 7 | (469) | (1) | (411) |
Net change in unrealized gains (losses) on available-for-sale debt securities: | ||||
Unrealized gains (losses), net of tax of $0, $(11), $9, and $(11) | 44 | 1 | 76 | (40) |
Reclassification adjustment for losses (gains) included in “Other income (expense), net,” net of tax of $0, $0, $0, and $0 | (1) | 1 | 0 | 1 |
Net unrealized gains (losses) on available-for-sale debt securities | 43 | 2 | 76 | (39) |
Total other comprehensive income (loss) | 50 | (467) | 75 | (450) |
Comprehensive income | $ 2,675 | $ 2,067 | $ 6,261 | $ 3,713 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Foreign currency translation adjustments, tax | $ (6) | $ (1) | $ (8) | $ 17 |
Unrealized gains (losses), tax | (11) | 0 | (11) | 9 |
Reclassification adjustment for losses (gains) included in “Other income (expense), net,” tax | $ 0 | $ 0 | $ 0 | $ 0 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 22,616 | $ 31,750 |
Marketable securities | 18,847 | 9,500 |
Inventories | 18,580 | 17,174 |
Accounts receivable, net and other | 16,747 | 16,677 |
Total current assets | 76,790 | 75,101 |
Property and equipment, net | 64,723 | 61,797 |
Operating leases | 21,649 | 0 |
Goodwill | 14,727 | 14,548 |
Other assets | 13,462 | 11,202 |
Total assets | 191,351 | 162,648 |
Current liabilities: | ||
Accounts payable | 36,063 | 38,192 |
Accrued expenses and other | 26,140 | 23,663 |
Unearned revenue | 7,475 | 6,536 |
Total current liabilities | 69,678 | 68,391 |
Long-term lease liabilities | 35,134 | 9,650 |
Long-term debt | 23,329 | 23,495 |
Other long-term liabilities | 10,149 | 17,563 |
Commitments and contingencies (Note 4) | ||
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 - 514 and 518 Outstanding shares - 491 and 494 | 5 | 5 |
Treasury stock, at cost | (1,837) | (1,837) |
Additional paid-in capital | 30,035 | 26,791 |
Accumulated other comprehensive loss | (960) | (1,035) |
Retained earnings | 25,818 | 19,625 |
Total stockholders’ equity | 53,061 | 43,549 |
Total liabilities and stockholders’ equity | $ 191,351 | $ 162,648 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2019 | Dec. 31, 2018 |
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 | 518,000,000 | 514,000,000 |
Common stock, outstanding shares | 494,000,000 | 491,000,000 |
Accounting Policies
Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
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 cash flows, operating results, and balance sheets for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 2019 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 2018 Annual Report on Form 10-K. Prior Period Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation, including the reclassification of long-term capital lease obligations that existed at December 31, 2018 from “Other long-term liabilities” to “Long-term lease liabilities” within the consolidated balance sheets, as a result of the adoption of new accounting guidance for leases. See “Accounting Pronouncements Recently Adopted.” 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, income taxes, commitments and contingencies, valuation of acquired intangibles and goodwill, stock-based compensation forfeiture rates, vendor funding, and inventory valuation. 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 Six Months Ended 2018 2019 2018 2019 Shares used in computation of basic earnings per share 486 493 485 492 Total dilutive effect of outstanding stock awards 14 10 14 11 Shares used in computation of diluted earnings per share 500 503 499 503 Accounts Receivable, Net and Other Included in “Accounts receivable, net and other” on our consolidated balance sheets are amounts primarily related to customers, vendors, and sellers. As of December 31, 2018 and June 30, 2019 , customer receivables, net, were $9.4 billion and $10.6 billion , vendor receivables, net, were $3.2 billion and $2.6 billion , and seller receivables, net, were $710 million and $638 million . Seller receivables are amounts due from sellers related to our seller lending program, which provides funding to sellers primarily to procure inventory. Leases We categorize leases with contractual terms longer than twelve months as either operating or finance. Finance leases are generally those leases that allow us to substantially utilize or pay for the entire asset over its estimated life. Assets acquired under finance leases are recorded in property and equipment, net. All other leases are categorized as operating leases. Our leases generally have terms that range from two to ten years for equipment and two to twenty years for property. Certain lease contracts include obligations to pay for other services, such as operations and maintenance. For leases of property, we account for these other services as a component of the lease. For substantially all other leases, the services are accounted for separately and we allocate payments to the lease and other services components based on estimated stand-alone prices. Lease liabilities are recognized at the present value of the fixed lease payments, reduced by landlord incentives using a discount rate based on similarly secured borrowings available to us. Lease assets are recognized based on the initial present value of the fixed lease payments, reduced by landlord incentives, plus any direct costs from executing the leases. Lease assets are tested for impairment in the same manner as long-lived assets used in operations. Leasehold improvements are capitalized at cost and amortized over the lesser of their expected useful life or the lease term. When we have the option to extend the lease term, terminate the lease before the contractual expiration date, or purchase the leased asset, and it is reasonably certain that we will exercise the option, we consider these options in determining the classification and measurement of the lease. Our leases may include variable payments based on measures that include changes in price indices, market interest rates, or the level of sales at a physical store, which are expensed as incurred. Costs associated with operating lease assets are recognized on a straight-line basis within operating expenses over the term of the lease. Finance lease assets are amortized within operating expenses on a straight-line basis over the shorter of the estimated useful lives of the assets or the lease term. The interest component of a finance lease is included in interest expense and recognized using the effective interest method over the lease term. Financing Obligations We record assets and liabilities for estimated construction costs under build-to-suit lease arrangements when we have control over the building during the construction period. If we continue to control the building after the construction period, the arrangement is classified as a financing obligation instead of a lease. The building is depreciated over the shorter of its useful life or the term of the obligation. If we do not control the building after the construction period ends, the assets and liabilities for construction costs are derecognized, and we classify the lease as either operating or finance. Digital Video and Music Content We obtain video content, inclusive of episodic television and movies, and music content for customers through licensing agreements that have a wide range of licensing provisions including both fixed and variable payment schedules. When the license fee for a specific video or music title is determinable or reasonably estimable and the content is available to us, we recognize an asset and a corresponding liability for the amounts owed. We reduce the liability as payments are made and we amortize the asset to “Cost of sales” on an accelerated basis, based on estimated usage or viewing patterns, or on a straight-line basis. If the licensing fee is not determinable or reasonably estimable, no asset or liability is recorded and licensing costs are expensed as incurred. We also develop original video content for which the production costs are capitalized and amortized to “Cost of sales” predominantly on an accelerated basis that follows the viewing patterns associated with the content. The weighted average remaining life of our capitalized video content is 2.5 years . Our produced and licensed video content is primarily monetized together as a unit, referred to as a film group, in each major geography where we offer Amazon Prime memberships. These film groups are evaluated for impairment whenever an event occurs or circumstances change indicating the fair value is less than the carrying value. The total capitalized costs of video, which is primarily released content, and music as of December 31, 2018 and June 30, 2019 were $3.8 billion and $4.6 billion . Total video and music expense was $1.6 billion and $1.8 billion in Q2 2018 and Q2 2019 , and $3.2 billion and $3.5 billion for the six months ended June 30, 2018 and 2019 . Total video and music expense includes licensing and production costs associated with content offered within Amazon Prime memberships, and costs associated with digital subscriptions and sold or rented content. Unearned Revenue Unearned revenue is recorded when payments are received or due in advance of performing our service obligations and is recognized over the service period. Unearned revenue primarily relates to prepayments of AWS services and Amazon Prime memberships. Our total unearned revenue as of December 31, 2018 was $7.9 billion , of which $4.6 billion was recognized as revenue during the six months ended June 30, 2019 . Included in “Other long-term liabilities” on our consolidated balance sheets was $1.4 billion and $1.6 billion of unearned revenue as of December 31, 2018 and June 30, 2019 . Additionally, we have performance obligations, primarily related to AWS, associated with commitments in customer contracts for future services that have not yet been recognized in our financial statements. For contracts with original terms that exceed one year, those commitments not yet recognized were $25.1 billion as of June 30, 2019 . The weighted average remaining life of our long-term contracts is 3.4 years . However, the amount and timing of revenue recognition is largely driven by customer usage, which can extend beyond the original contractual term. Accounting Pronouncements Recently Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) amending the accounting for leases, primarily requiring the recognition of lease assets and liabilities for operating leases with terms of more than twelve months on our consolidated balance sheets. Under the new guidance, leases previously described as capital lease obligations and finance lease obligations are now referred to as finance leases and financing obligations, respectively. We adopted this ASU on January 1, 2019 by recording an immaterial cumulative adjustment to retained earnings rather than retrospectively adjusting prior periods. Prior period amounts were not adjusted and continue to be reported in accordance with our historic accounting policies resulting in a balance sheet presentation that is not comparable to the prior period in the first year of adoption. The adoption of this ASU resulted in the recognition of operating lease assets and liabilities of approximately $21 billion , which included the reclassification of finance lease obligations to operating leases of $1.2 billion . As of December 31, 2018, amounts related to finance lease obligations and construction liabilities totaled $9.6 billion , of which $1.5 billion was derecognized for buildings that we do not control during the construction period and $5.4 billion and $1.5 billion were reclassified to finance leases and operating leases, respectively. In March 2019, the FASB issued an ASU amending the accounting for film costs, inclusive of episodic television and movie costs. The new guidance aligns the accounting for production costs of episodic television with that of movies by requiring production costs to be capitalized. Previously, we only capitalized a portion of the production costs related to our produced episodic television content. We adopted this ASU as of January 1, 2019 and began capitalizing substantially all of our production costs. Adoption of this ASU resulted in approximately $342 million of incremental capitalized film costs classified in “Other Assets” for the six months ended June 30, 2019 . |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Financial Instruments | FINANCIAL INSTRUMENTS Cash, Cash Equivalents, Restricted Cash, and Marketable Securities As of December 31, 2018 and June 30, 2019 , our cash, cash equivalents, restricted cash, and marketable securities primarily consisted of cash, AAA-rated money market funds, U.S. and foreign government and agency securities, 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 certain marketable equity securities based on quoted prices in active markets for identical assets or liabilities. Other marketable securities 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 significant amounts of cash, cash equivalents, restricted cash, or marketable securities categorized as Level 3 assets as of December 31, 2018 and June 30, 2019 . The following table summarizes, by major security type, our cash, cash equivalents, restricted cash, 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, 2018 June 30, 2019 Total Cost or Gross Gross Total Cash $ 10,406 $ 8,553 $ — $ — $ 8,553 Level 1 securities: Money market funds 12,515 10,757 — — 10,757 Equity securities (1) 170 277 Level 2 securities: Foreign government and agency securities 815 1,596 — — 1,596 U.S. government and agency securities 11,667 8,573 13 (5 ) 8,581 Corporate debt securities 4,990 9,915 31 (2 ) 9,944 Asset-backed securities 892 1,834 7 (1 ) 1,840 Other fixed income securities 188 264 2 — 266 Equity securities (1) 33 — $ 41,676 $ 41,492 $ 53 $ (8 ) $ 41,814 Less: Restricted cash, cash equivalents, and marketable securities (2) (426 ) (351 ) Total cash, cash equivalents, and marketable securities $ 41,250 $ 41,463 ___________________ (1) The related unrealized gain (loss) recorded in “Other income (expense), net” was $14 million in Q2 2019 and $82 million for the six months ended June 30, 2019 . (2) We are required to pledge or otherwise restrict a portion of our cash, cash equivalents, and marketable securities as collateral for real estate leases, amounts due to third-party sellers in certain jurisdictions, debt, and standby and trade letters of credit. 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 4 — Commitments and Contingencies.” The following table summarizes the remaining contractual maturities of our cash equivalents and marketable fixed income securities as of June 30, 2019 (in millions): Amortized Cost Estimated Fair Value Due within one year $ 24,249 $ 24,255 Due after one year through five years 7,428 7,467 Due after five years through ten years 296 296 Due after ten years 966 966 Total $ 32,939 $ 32,984 Actual maturities may differ from the contractual maturities because borrowers may have certain prepayment conditions. Equity Warrants and Non-Marketable Equity Securities We hold equity warrants giving us the right to acquire stock of other companies. As of December 31, 2018 and June 30, 2019 , these warrants had a fair value of $440 million and $613 million , and are recorded within “Other assets” on our consolidated balance sheets. The related gain (loss) recorded in “Other income (expense), net” was $40 million and $(16) million in Q2 2018 and Q2 2019 , and $86 million and $73 million for the six months ended June 30, 2018 and 2019 . These assets are primarily classified as Level 2 assets. As of December 31, 2018 and June 30, 2019 , equity securities not accounted for under the equity-method and without readily determinable fair values, had a carrying value of $282 million and $888 million , and are recorded within “Other assets” on our consolidated balance sheets. Consolidated Statements of Cash Flows Reconciliation The following table provides a reconciliation of the amount of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets to the total of the same such amounts shown in the consolidated statements of cash flows (in millions): December 31, 2018 June 30, 2019 Cash and cash equivalents $ 31,750 $ 22,616 Restricted cash included in accounts receivable, net and other 418 318 Restricted cash included in other assets 5 31 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 32,173 $ 22,965 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Leases | LEASES Gross assets recorded under finance leases, included in “Property and equipment, net,” were $36.1 billion and $50.3 billion as of December 31, 2018 and June 30, 2019 . Accumulated amortization associated with finance leases was $19.8 billion and $25.4 billion as of December 31, 2018 and June 30, 2019 . Lease cost recognized in our consolidated statements of operations is summarized as follows (in millions): Three Months Ended June 30, 2019 Six Months Ended June 30, 2019 Operating lease cost (1) $ 874 $ 1,710 Finance lease cost: Amortization of lease assets 2,402 4,709 Interest on lease liabilities 160 316 Finance lease cost 2,562 5,025 Variable lease cost 281 531 Total lease cost $ 3,717 $ 7,266 __________________ (1) Rental expense under operating lease agreements was $815 million for Q2 2018 and $1.6 billion for the six months ended June 30, 2018 . Other information about lease amounts recognized in our consolidated financial statements is summarized as follows: June 30, 2019 Weighted-average remaining lease term – operating leases 11.2 years Weighted-average remaining lease term – finance leases 5.7 years Weighted-average discount rate – operating leases 3.2 % Weighted-average discount rate – finance leases 2.9 % As of June 30, 2019 , our lease liabilities were as follows (in millions): Operating Leases Finance Leases Total Gross lease liabilities $ 28,739 $ 26,204 $ 54,943 Less: imputed interest (6,324 ) (1,970 ) (8,294 ) Present value of lease liabilities 22,415 24,234 46,649 Less: current portion of lease liabilities (2,631 ) (8,884 ) (11,515 ) Total long-term lease liabilities $ 19,784 $ 15,350 $ 35,134 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Commitments We have entered into non-cancellable operating and finance leases and financing obligations for equipment and office, fulfillment, sortation, delivery, data center, physical store, and renewable energy facilities. The following summarizes our principal contractual commitments, excluding open orders for purchases that support normal operations and are generally cancellable, as of June 30, 2019 (in millions): Six Months Ended December 31, Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Total Debt principal and interest $ 1,816 $ 2,162 $ 1,887 $ 2,103 $ 1,807 $ 30,020 $ 39,795 Operating leases 1,632 3,377 3,102 2,744 2,438 15,446 28,739 Finance lease liabilities, including interest 4,319 8,418 5,359 1,961 1,026 5,121 26,204 Financing obligations, including interest 18 44 45 45 46 703 901 Unconditional purchase obligations (1) 1,176 3,416 3,464 3,167 3,002 5,253 19,478 Other commitments (2) (3) 1,296 2,498 1,871 1,676 1,129 11,057 19,527 Total commitments $ 10,257 $ 19,915 $ 15,728 $ 11,696 $ 9,448 $ 67,600 $ 134,644 ___________________ (1) Includes unconditional purchase obligations related to certain products offered in our Whole Foods Market stores and long-term agreements to acquire and license digital media content that are not reflected on the consolidated balance sheets. For those digital media content 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. (2) Includes the estimated timing and amounts of payments for rent and tenant improvements associated with build-to-suit lease arrangements and lease arrangements prior to the lease commencement date and digital media content liabilities associated with long-term digital media content assets with initial terms greater than one year. (3) Excludes approximately $3.7 billion of accrued tax contingencies for which we cannot make a reasonably reliable estimate of the amount and period of payment, if any. Pledged Assets As of December 31, 2018 and June 30, 2019 , we have pledged or otherwise restricted $575 million and $586 million of our cash, cash equivalents, and marketable securities, and certain property and equipment as collateral for real estate leases, amounts due to third-party sellers in certain jurisdictions, debt, and standby and trade letters of credit. 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.” We are subject to claims related to various indirect taxes (such as sales, value added, consumption, service, and similar taxes), including in jurisdictions in which we already collect and remit such taxes. If the relevant taxing authorities were successfully to pursue these claims, we could be subject to significant additional tax liabilities. For example, in June 2017, the State of South Carolina issued an assessment for uncollected sales and use taxes for the period from January 2016 to March 2016, including interest and penalties. South Carolina is alleging that we should have collected sales and use taxes on transactions by our third-party sellers. We believe the assessment is without merit. If South Carolina or other states were successfully to seek additional adjustments of a similar nature, we could be subject to significant additional tax liabilities. We intend to defend ourselves vigorously in this matter. 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 2018 Annual Report on Form 10-K and in Item 1 of Part I, “Financial Statements — Note 4 — Commitments and Contingencies — Legal Proceedings” of our Quarterly Report on Form 10-Q for the period ended March 31, 2019 as supplemented by the following: In May 2019, Neodron Ltd. filed a petition with the United States International Trade Commission requesting that the International Trade Commission commence an investigation into the sale of Amazon Fire HD 10 tablets and certain Dell, Hewlett Packard, Lenovo, Microsoft, Motorola, and Samsung devices (the “accused devices”). Neodron’s petition alleges that the accused devices infringe at least one of U.S. Patent Nos. 8,422,173, entitled “Capacitive Position Sensor”; 8,791,910, entitled “Capacitive Keyboard With Position-Dependent Reduced Keying Ambiguity”; 9,024,790, entitled “Capacitive Keyboard With Non-Locking Reduced Keying Ambiguity”; and 9,372,580, entitled “Enhanced Touch Detection Methods.” Neodron is seeking a limited exclusion order preventing the importation of the accused devices into the United States. In May 2019, Neodron also filed a complaint against Amazon.com, Inc. in the United States District Court for the Western District of Texas. The complaint alleges, among other things, that Amazon’s Fire HD 10 tablet infringes U.S. Patent Nos. 8,422,173, entitled “Capacitive Position Sensor,” and 9,372,580, entitled “Enhanced Touch Detection Methods.” The May 2019 complaint seeks an unspecified amount of damages and interest, a permanent injunction, and enhanced damages. In June 2019, Neodron filed a second complaint against Amazon.com, Inc. in the United States District Court for the Western District of Texas. The complaint alleges, among other things, that Amazon’s Fire HD 10 tablet infringes U.S. Patent Nos. 9,823,784, entitled “Capacitive Touch Screen With Noise Suppression”; 9,489,072, entitled “Noise Reduction In Capacitive Touch Sensors”; and 8,502,547, entitled “Capacitive Sensor.” The June 2019 complaint seeks an unspecified amount of damages and interest, a permanent injunction, and enhanced damages. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in these matters. 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 the matters we disclose that do not include an estimate of the amount of loss or range of losses, such an estimate is not possible or is immaterial, 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 7 — Income Taxes.” |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | DEBT As of June 30, 2019 , we had $24.3 billion of unsecured senior notes outstanding (the “Notes”). As of December 31, 2018 and June 30, 2019 , the net unamortized discount and debt issuance costs on the Notes was $101 million . We also have other long-term debt with a carrying amount, including the current portion and borrowings under our credit facility, of $715 million and $816 million as of December 31, 2018 and June 30, 2019 . The face value of our total long-term debt obligations is as follows (in millions): December 31, 2018 June 30, 2019 2.600% Notes due on December 5, 2019 (2) 1,000 1,000 1.900% Notes due on August 21, 2020 (3) 1,000 1,000 3.300% Notes due on December 5, 2021 (2) 1,000 1,000 2.500% Notes due on November 29, 2022 (1) 1,250 1,250 2.400% Notes due on February 22, 2023 (3) 1,000 1,000 2.800% Notes due on August 22, 2024 (3) 2,000 2,000 3.800% Notes due on December 5, 2024 (2) 1,250 1,250 5.200% Notes due on December 3, 2025 (4) 1,000 1,000 3.150% Notes due on August 22, 2027 (3) 3,500 3,500 4.800% Notes due on December 5, 2034 (2) 1,250 1,250 3.875% Notes due on August 22, 2037 (3) 2,750 2,750 4.950% Notes due on December 5, 2044 (2) 1,500 1,500 4.050% Notes due on August 22, 2047 (3) 3,500 3,500 4.250% Notes due on August 22, 2057 (3) 2,250 2,250 Credit Facility 594 509 Other long-term debt 121 307 Total debt 24,965 25,066 Less current portion of long-term debt (1,371 ) (1,636 ) Face value of long-term debt $ 23,594 $ 23,430 _____________________________ (1) Issued in November 2012, effective interest rate of the 2022 Notes was 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% . (3) Issued in August 2017, effective interest rates of the 2020, 2023, 2024, 2027, 2037, 2047, and 2057 Notes were 2.16% , 2.56% , 2.95% , 3.25% , 3.94% , 4.13% , and 4.33% . (4) Consists of $872 million of 2025 Notes issued in December 2017 in exchange for notes assumed in connection with the acquisition of Whole Foods Market and $128 million of 2025 Notes issued by Whole Foods Market that did not participate in our December 2017 exchange offer. The effective interest rate of the 2025 Notes was 3.02% . 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. Interest on the Notes issued in 2017 is payable semi-annually in arrears in February and August. Interest on the 2025 Notes 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 November 2012 and the December 2014 Notes were used for general corporate purposes. The proceeds from the August 2017 Notes were used to fund the consideration for the acquisition of Whole Foods Market, to repay notes due in 2017, and for general corporate purposes. The estimated fair value of the Notes was approximately $24.3 billion and $26.6 billion as of December 31, 2018 and June 30, 2019 , which is based on Level 2 inputs. In October 2016, we entered into a $500 million secured revolving credit facility with a lender that is secured by certain seller receivables, which we subsequently increased to $620 million and may from time to time increase in the future subject to lender approval (the “Credit Facility”). 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 $594 million and $509 million of borrowings outstanding under the Credit Facility as of December 31, 2018 and June 30, 2019 , with weighted-average interest rates of 3.2% and 3.4% as of December 31, 2018 and June 30, 2019 . As of December 31, 2018 and June 30, 2019 , we have pledged $686 million and $590 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, 2018 and June 30, 2019 . Other long-term debt, including the current portion, had a weighted-average interest rate of 6.0% and 5.2% as of December 31, 2018 and June 30, 2019 . We used the net proceeds from the issuance of this debt primarily to fund certain business operations. The estimated fair value of other long-term debt, which is based on Level 2 inputs, approximated its carrying value as of December 31, 2018 and June 30, 2019 . In April 2018, we established a commercial paper program (the “Commercial Paper Program”) under which we may from time to time issue unsecured commercial paper up to a total of $7.0 billion at any time, with individual maturities that may vary but will not exceed 397 days from the date of issue. There were no borrowings outstanding under the Commercial Paper Program as of December 31, 2018 and June 30, 2019 . In April 2018, in connection with our Commercial Paper Program, we amended and restated our unsecured revolving credit facility (the “Credit Agreement”) with a syndicate of lenders to increase our borrowing capacity thereunder to $7.0 billion . As amended and restated, 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 interest rate applicable to outstanding balances under the amended and restated Credit Agreement is LIBOR plus 0.50% , with a commitment fee of 0.04% on the undrawn portion of the credit facility. There were no borrowings outstanding under the Credit Agreement as of December 31, 2018 and June 30, 2019 . |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2019 | |
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. There were no repurchases of common stock during the six months ended June 30, 2018 or 2019 . Stock Award Activity Common shares outstanding plus shares underlying outstanding stock awards totaled 507 million and 510 million as of December 31, 2018 and June 30, 2019 . 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 Six Months Ended 2018 2019 2018 2019 Cost of sales $ 19 $ 43 $ 34 $ 67 Fulfillment 320 360 564 594 Marketing 190 307 351 516 Technology and content 788 1,077 1,419 1,752 General and administrative 151 184 284 316 Total stock-based compensation expense $ 1,468 $ 1,971 $ 2,652 $ 3,245 The following table summarizes our restricted stock unit activity for the six months ended June 30, 2019 (in millions): Number of Units Weighted-Average Grant-Date Fair Value Outstanding as of December 31, 2018 15.9 $ 1,024 Units granted 4.6 1,807 Units vested (3.4 ) 789 Units forfeited (0.9 ) 1,120 Outstanding as of June 30, 2019 16.2 $ 1,287 Scheduled vesting for outstanding restricted stock units as of June 30, 2019 , is as follows (in millions): Six Months Ended December 31, Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Total Scheduled vesting—restricted stock units 3.2 6.1 4.9 1.4 0.4 0.2 16.2 As of June 30, 2019 , there was $9.4 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 . The estimated forfeiture rate as of December 31, 2018 and June 30, 2019 was 27% . Changes in our estimates and assumptions relating to forfeitures may cause us to realize material changes in stock-based compensation expense in the future. Changes in Stockholders’ Equity The following table shows the changes in stockholders’ equity (in millions): Three Months Ended Six Months Ended 2018 2019 2018 2019 Total beginning stockholders’ equity $ 31,463 $ 48,410 $ 27,709 $ 43,549 Beginning and ending common stock 5 5 5 5 Beginning and ending treasury stock (1,837 ) (1,837 ) (1,837 ) (1,837 ) Beginning additional paid-in capital 22,563 28,059 21,389 26,791 Stock-based compensation and issuance of employee benefit plan stock 1,465 1,976 2,639 3,244 Ending additional paid-in capital 24,028 30,035 24,028 30,035 Beginning accumulated other comprehensive loss (467 ) (1,010 ) (484 ) (1,035 ) Other comprehensive income (loss) (467 ) 50 (450 ) 75 Ending accumulated other comprehensive loss (934 ) (960 ) (934 ) (960 ) Beginning retained earnings 11,199 23,193 8,636 19,625 Cumulative effect of changes in accounting principles (1) — — 934 7 Net income 2,534 2,625 4,163 6,186 Ending retained earnings 13,733 25,818 13,733 25,818 Total ending stockholders’ equity $ 34,995 $ 53,061 $ 34,995 $ 53,061 ___________________ (1) We recorded cumulative effect adjustments related to the new revenue and income tax standards in Q1 2018 and the new lease standard in Q1 2019. See Item 1 of Part I, “Financial Statements — Note 1 — Accounting Policies — Accounting Pronouncements Recently Adopted” for additional information. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
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, intercompany transactions, the applicability of special tax regimes, changes in how we do business, acquisitions, investments, audit-related developments, changes in our stock price, changes in our deferred tax assets and liabilities and their valuation, foreign currency gains (losses), changes in statutes, regulations, case law, and administrative practices, principles, and interpretations related to tax, including changes to the global tax framework, competition, and other laws and accounting rules in various jurisdictions, 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 2019 , 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 and losses incurred in certain foreign jurisdictions for which we may not realize a tax benefit. Losses for which we may not realize a related tax benefit, primarily due to losses of foreign subsidiaries, reduce our pre-tax income without a corresponding reduction in our tax expense, and therefore increase our effective tax rate. We record valuation allowances against the deferred tax assets associated with losses for which we may not realize a related tax benefit. Our income tax provisions for the six months ended June 30, 2018 and 2019 were $361 million and $1.1 billion , which included $964 million and $706 million of net discrete tax benefits primarily attributable to excess tax benefits from stock-based compensation. Cash paid for income taxes, net of refunds was $300 million and $283 million in Q2 2018 and Q2 2019 , and $813 million and $451 million for the six months ended June 30, 2018 and 2019 . As of December 31, 2018 and June 30, 2019 , tax contingencies were approximately $3.4 billion and $3.7 billion . We expect the total amount of tax contingencies will grow in 2019 . 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 twelve 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. In September 2017, the IRS appealed the decision to the U.S. Court of Appeals for the Ninth Circuit. We will continue to defend ourselves vigorously in this matter. 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. 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. On October 4, 2017, the European Commission announced its decision that determinations by the tax authorities in Luxembourg did not comply with European Union rules on state aid. Based on that decision the European Commission announced an estimated recovery amount of approximately €250 million , plus interest, for the period May 2006 through June 2014, and ordered Luxembourg tax authorities to calculate the actual amount of additional taxes subject to recovery. Luxembourg computed an initial recovery amount, consistent with the European Commission’s decision, that we deposited into escrow in March 2018, subject to adjustment pending conclusion of all appeals. In December 2017, Luxembourg appealed the European Commission’s decision. In May 2018, we appealed. We believe the European Commission’s decision to be without merit and will continue to defend ourselves vigorously in this matter. We are also subject to taxation in various states and other foreign jurisdictions including China, Germany, India, 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 | 6 Months Ended |
Jun. 30, 2019 | |
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. 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 online and physical stores. This segment includes export sales from these online stores. International The International segment primarily consists of amounts earned from retail sales of consumer products (including from sellers) and subscriptions through internationally-focused online stores. This segment includes export sales from these internationally-focused online stores (including export sales from these online stores to customers in the U.S., Mexico, and Canada), but excludes export sales from our North America-focused online stores. 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 Six Months Ended 2018 2019 2018 2019 North America Net sales $ 32,169 $ 38,653 $ 62,894 $ 74,465 Operating expenses 30,334 37,089 59,910 70,614 Operating income $ 1,835 $ 1,564 $ 2,984 $ 3,851 International Net sales $ 14,612 $ 16,370 $ 29,487 $ 32,563 Operating expenses 15,106 16,971 30,603 33,253 Operating income (loss) $ (494 ) $ (601 ) $ (1,116 ) $ (690 ) AWS Net sales $ 6,105 $ 8,381 $ 11,547 $ 16,076 Operating expenses 4,463 6,260 8,504 11,733 Operating income $ 1,642 $ 2,121 $ 3,043 $ 4,343 Consolidated Net sales $ 52,886 $ 63,404 $ 103,928 $ 123,104 Operating expenses 49,903 60,320 99,017 115,600 Operating income 2,983 3,084 4,911 7,504 Total non-operating income (expense) (378 ) (195 ) (391 ) (213 ) Provision for income taxes (74 ) (257 ) (361 ) (1,094 ) Equity-method investment activity, net of tax 3 (7 ) 4 (11 ) Net income $ 2,534 $ 2,625 $ 4,163 $ 6,186 Net sales by groups of similar products and services, which also have similar economic characteristics, is as follows (in millions): Three Months Ended Six Months Ended 2018 2019 2018 2019 Net Sales: Online stores (1) $ 27,165 $ 31,053 $ 54,105 $ 60,552 Physical stores (2) 4,312 4,330 8,575 8,636 Third-party seller services (3) 9,702 11,962 18,966 23,104 Subscription services (4) 3,408 4,676 6,510 9,018 AWS 6,105 8,381 11,547 16,076 Other (5) 2,194 3,002 4,225 5,718 Consolidated $ 52,886 $ 63,404 $ 103,928 $ 123,104 ____________________________ (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 media products available in both a physical and digital format, such as books, music, videos, 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 Subscription services. (2) Includes product sales where our customers physically select items in a store. Sales from customers who order goods online for delivery or pickup at our physical stores are included in “Online stores.” (3) Includes commissions and any related fulfillment and shipping fees, and other third-party seller services. (4) Includes annual and monthly fees associated with Amazon Prime memberships, as well as audiobook, digital video, e-book, digital music, and other non-AWS subscription services. (5) Primarily includes sales of advertising services, as well as sales related to our other service offerings. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
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 cash flows, operating results, and balance sheets for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 2019 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 2018 Annual Report on Form 10-K. |
Prior Period Reclassifications | Prior Period Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation, including the reclassification of long-term capital lease obligations that existed at December 31, 2018 from “Other long-term liabilities” to “Long-term lease liabilities” within the consolidated balance sheets, as a result of the adoption of new accounting guidance for leases. See “Accounting Pronouncements Recently Adopted.” |
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, income taxes, commitments and contingencies, valuation of acquired intangibles and goodwill, stock-based compensation forfeiture rates, vendor funding, and inventory valuation. 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. |
Accounts Receivable, Net and Other | Accounts Receivable, Net and Other Included in “Accounts receivable, net and other” on our consolidated balance sheets are amounts primarily related to customers, vendors, and sellers. As of December 31, 2018 and June 30, 2019 , customer receivables, net, were $9.4 billion and $10.6 billion , vendor receivables, net, were $3.2 billion and $2.6 billion , and seller receivables, net, were $710 million and $638 million . Seller receivables are amounts due from sellers related to our seller lending program, which provides funding to sellers primarily to procure inventory. |
Leases | Leases We categorize leases with contractual terms longer than twelve months as either operating or finance. Finance leases are generally those leases that allow us to substantially utilize or pay for the entire asset over its estimated life. Assets acquired under finance leases are recorded in property and equipment, net. All other leases are categorized as operating leases. Our leases generally have terms that range from two to ten years for equipment and two to twenty years for property. Certain lease contracts include obligations to pay for other services, such as operations and maintenance. For leases of property, we account for these other services as a component of the lease. For substantially all other leases, the services are accounted for separately and we allocate payments to the lease and other services components based on estimated stand-alone prices. Lease liabilities are recognized at the present value of the fixed lease payments, reduced by landlord incentives using a discount rate based on similarly secured borrowings available to us. Lease assets are recognized based on the initial present value of the fixed lease payments, reduced by landlord incentives, plus any direct costs from executing the leases. Lease assets are tested for impairment in the same manner as long-lived assets used in operations. Leasehold improvements are capitalized at cost and amortized over the lesser of their expected useful life or the lease term. When we have the option to extend the lease term, terminate the lease before the contractual expiration date, or purchase the leased asset, and it is reasonably certain that we will exercise the option, we consider these options in determining the classification and measurement of the lease. Our leases may include variable payments based on measures that include changes in price indices, market interest rates, or the level of sales at a physical store, which are expensed as incurred. Costs associated with operating lease assets are recognized on a straight-line basis within operating expenses over the term of the lease. Finance lease assets are amortized within operating expenses on a straight-line basis over the shorter of the estimated useful lives of the assets or the lease term. The interest component of a finance lease is included in interest expense and recognized using the effective interest method over the lease term. |
Financing Obligations | Financing Obligations We record assets and liabilities for estimated construction costs under build-to-suit lease arrangements when we have control over the building during the construction period. If we continue to control the building after the construction period, the arrangement is classified as a financing obligation instead of a lease. The building is depreciated over the shorter of its useful life or the term of the obligation. If we do not control the building after the construction period ends, the assets and liabilities for construction costs are derecognized, and we classify the lease as either operating or finance. |
Video And Music Content | Digital Video and Music Content We obtain video content, inclusive of episodic television and movies, and music content for customers through licensing agreements that have a wide range of licensing provisions including both fixed and variable payment schedules. When the license fee for a specific video or music title is determinable or reasonably estimable and the content is available to us, we recognize an asset and a corresponding liability for the amounts owed. We reduce the liability as payments are made and we amortize the asset to “Cost of sales” on an accelerated basis, based on estimated usage or viewing patterns, or on a straight-line basis. If the licensing fee is not determinable or reasonably estimable, no asset or liability is recorded and licensing costs are expensed as incurred. We also develop original video content for which the production costs are capitalized and amortized to “Cost of sales” predominantly on an accelerated basis that follows the viewing patterns associated with the content. The weighted average remaining life of our capitalized video content is 2.5 years . Our produced and licensed video content is primarily monetized together as a unit, referred to as a film group, in each major geography where we offer Amazon Prime memberships. These film groups are evaluated for impairment whenever an event occurs or circumstances change indicating the fair value is less than the carrying value. The total capitalized costs of video, which is primarily released content, and music as of December 31, 2018 and June 30, 2019 were $3.8 billion and $4.6 billion . Total video and music expense was $1.6 billion and $1.8 billion in Q2 2018 and Q2 2019 , and $3.2 billion and $3.5 billion for the six months ended June 30, 2018 and 2019 . Total video and music expense includes licensing and production costs associated with content offered within Amazon Prime memberships, and costs associated with digital subscriptions and sold or rented content. |
Unearned Revenue | Unearned Revenue Unearned revenue is recorded when payments are received or due in advance of performing our service obligations and is recognized over the service period. Unearned revenue primarily relates to prepayments of AWS services and Amazon Prime memberships. Our total unearned revenue as of December 31, 2018 was $7.9 billion , of which $4.6 billion was recognized as revenue during the six months ended June 30, 2019 . Included in “Other long-term liabilities” on our consolidated balance sheets was $1.4 billion and $1.6 billion of unearned revenue as of December 31, 2018 and June 30, 2019 . Additionally, we have performance obligations, primarily related to AWS, associated with commitments in customer contracts for future services that have not yet been recognized in our financial statements. For contracts with original terms that exceed one year, those commitments not yet recognized were $25.1 billion as of June 30, 2019 . The weighted average remaining life of our long-term contracts is 3.4 years . However, the amount and timing of revenue recognition is largely driven by customer usage, which can extend beyond the original contractual term. |
Accounting Pronouncements Recently Adopted | Accounting Pronouncements Recently Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) amending the accounting for leases, primarily requiring the recognition of lease assets and liabilities for operating leases with terms of more than twelve months on our consolidated balance sheets. Under the new guidance, leases previously described as capital lease obligations and finance lease obligations are now referred to as finance leases and financing obligations, respectively. We adopted this ASU on January 1, 2019 by recording an immaterial cumulative adjustment to retained earnings rather than retrospectively adjusting prior periods. Prior period amounts were not adjusted and continue to be reported in accordance with our historic accounting policies resulting in a balance sheet presentation that is not comparable to the prior period in the first year of adoption. The adoption of this ASU resulted in the recognition of operating lease assets and liabilities of approximately $21 billion , which included the reclassification of finance lease obligations to operating leases of $1.2 billion . As of December 31, 2018, amounts related to finance lease obligations and construction liabilities totaled $9.6 billion , of which $1.5 billion was derecognized for buildings that we do not control during the construction period and $5.4 billion and $1.5 billion were reclassified to finance leases and operating leases, respectively. In March 2019, the FASB issued an ASU amending the accounting for film costs, inclusive of episodic television and movie costs. The new guidance aligns the accounting for production costs of episodic television with that of movies by requiring production costs to be capitalized. Previously, we only capitalized a portion of the production costs related to our produced episodic television content. We adopted this ASU as of January 1, 2019 and began capitalizing substantially all of our production costs. Adoption of this ASU resulted in approximately $342 million of incremental capitalized film costs classified in “Other Assets” for the six months ended June 30, 2019 . |
Accounting Policies (Tables)
Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Calculation of Diluted Shares | The following table shows the calculation of diluted shares (in millions): Three Months Ended Six Months Ended 2018 2019 2018 2019 Shares used in computation of basic earnings per share 486 493 485 492 Total dilutive effect of outstanding stock awards 14 10 14 11 Shares used in computation of diluted earnings per share 500 503 499 503 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Fair Value by Major Security Type | The following table summarizes, by major security type, our cash, cash equivalents, restricted cash, 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, 2018 June 30, 2019 Total Cost or Gross Gross Total Cash $ 10,406 $ 8,553 $ — $ — $ 8,553 Level 1 securities: Money market funds 12,515 10,757 — — 10,757 Equity securities (1) 170 277 Level 2 securities: Foreign government and agency securities 815 1,596 — — 1,596 U.S. government and agency securities 11,667 8,573 13 (5 ) 8,581 Corporate debt securities 4,990 9,915 31 (2 ) 9,944 Asset-backed securities 892 1,834 7 (1 ) 1,840 Other fixed income securities 188 264 2 — 266 Equity securities (1) 33 — $ 41,676 $ 41,492 $ 53 $ (8 ) $ 41,814 Less: Restricted cash, cash equivalents, and marketable securities (2) (426 ) (351 ) Total cash, cash equivalents, and marketable securities $ 41,250 $ 41,463 ___________________ (1) The related unrealized gain (loss) recorded in “Other income (expense), net” was $14 million in Q2 2019 and $82 million for the six months ended June 30, 2019 . (2) We are required to pledge or otherwise restrict a portion of our cash, cash equivalents, and marketable securities as collateral for real estate leases, amounts due to third-party sellers in certain jurisdictions, debt, and standby and trade letters of credit. 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 4 — Commitments and Contingencies.” |
Investments Classified by Contractual Maturity Date | The following table summarizes the remaining contractual maturities of our cash equivalents and marketable fixed income securities as of June 30, 2019 (in millions): Amortized Cost Estimated Fair Value Due within one year $ 24,249 $ 24,255 Due after one year through five years 7,428 7,467 Due after five years through ten years 296 296 Due after ten years 966 966 Total $ 32,939 $ 32,984 Actual maturities may differ from the contractual maturities because borrowers may have certain prepayment conditions. |
Reconciliation of cash, cash equivalents, and restricted cash | The following table provides a reconciliation of the amount of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets to the total of the same such amounts shown in the consolidated statements of cash flows (in millions): December 31, 2018 June 30, 2019 Cash and cash equivalents $ 31,750 $ 22,616 Restricted cash included in accounts receivable, net and other 418 318 Restricted cash included in other assets 5 31 Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 32,173 $ 22,965 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Lease, Cost | Lease cost recognized in our consolidated statements of operations is summarized as follows (in millions): Three Months Ended June 30, 2019 Six Months Ended June 30, 2019 Operating lease cost (1) $ 874 $ 1,710 Finance lease cost: Amortization of lease assets 2,402 4,709 Interest on lease liabilities 160 316 Finance lease cost 2,562 5,025 Variable lease cost 281 531 Total lease cost $ 3,717 $ 7,266 __________________ (1) Rental expense under operating lease agreements was $815 million for Q2 2018 and $1.6 billion for the six months ended June 30, 2018 . |
Other Operating and Finance Lease Information | Other information about lease amounts recognized in our consolidated financial statements is summarized as follows: June 30, 2019 Weighted-average remaining lease term – operating leases 11.2 years Weighted-average remaining lease term – finance leases 5.7 years Weighted-average discount rate – operating leases 3.2 % Weighted-average discount rate – finance leases 2.9 % |
Operating and Finance Lease Liability Reconciliation | As of June 30, 2019 , our lease liabilities were as follows (in millions): Operating Leases Finance Leases Total Gross lease liabilities $ 28,739 $ 26,204 $ 54,943 Less: imputed interest (6,324 ) (1,970 ) (8,294 ) Present value of lease liabilities 22,415 24,234 46,649 Less: current portion of lease liabilities (2,631 ) (8,884 ) (11,515 ) Total long-term lease liabilities $ 19,784 $ 15,350 $ 35,134 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Principal Contractual Commitments, Excluding Open Orders for Purchases | The following summarizes our principal contractual commitments, excluding open orders for purchases that support normal operations and are generally cancellable, as of June 30, 2019 (in millions): Six Months Ended December 31, Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Total Debt principal and interest $ 1,816 $ 2,162 $ 1,887 $ 2,103 $ 1,807 $ 30,020 $ 39,795 Operating leases 1,632 3,377 3,102 2,744 2,438 15,446 28,739 Finance lease liabilities, including interest 4,319 8,418 5,359 1,961 1,026 5,121 26,204 Financing obligations, including interest 18 44 45 45 46 703 901 Unconditional purchase obligations (1) 1,176 3,416 3,464 3,167 3,002 5,253 19,478 Other commitments (2) (3) 1,296 2,498 1,871 1,676 1,129 11,057 19,527 Total commitments $ 10,257 $ 19,915 $ 15,728 $ 11,696 $ 9,448 $ 67,600 $ 134,644 ___________________ (1) Includes unconditional purchase obligations related to certain products offered in our Whole Foods Market stores and long-term agreements to acquire and license digital media content that are not reflected on the consolidated balance sheets. For those digital media content 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. (2) Includes the estimated timing and amounts of payments for rent and tenant improvements associated with build-to-suit lease arrangements and lease arrangements prior to the lease commencement date and digital media content liabilities associated with long-term digital media content assets with initial terms greater than one year. (3) Excludes approximately $3.7 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) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt Obligations | The face value of our total long-term debt obligations is as follows (in millions): December 31, 2018 June 30, 2019 2.600% Notes due on December 5, 2019 (2) 1,000 1,000 1.900% Notes due on August 21, 2020 (3) 1,000 1,000 3.300% Notes due on December 5, 2021 (2) 1,000 1,000 2.500% Notes due on November 29, 2022 (1) 1,250 1,250 2.400% Notes due on February 22, 2023 (3) 1,000 1,000 2.800% Notes due on August 22, 2024 (3) 2,000 2,000 3.800% Notes due on December 5, 2024 (2) 1,250 1,250 5.200% Notes due on December 3, 2025 (4) 1,000 1,000 3.150% Notes due on August 22, 2027 (3) 3,500 3,500 4.800% Notes due on December 5, 2034 (2) 1,250 1,250 3.875% Notes due on August 22, 2037 (3) 2,750 2,750 4.950% Notes due on December 5, 2044 (2) 1,500 1,500 4.050% Notes due on August 22, 2047 (3) 3,500 3,500 4.250% Notes due on August 22, 2057 (3) 2,250 2,250 Credit Facility 594 509 Other long-term debt 121 307 Total debt 24,965 25,066 Less current portion of long-term debt (1,371 ) (1,636 ) Face value of long-term debt $ 23,594 $ 23,430 _____________________________ (1) Issued in November 2012, effective interest rate of the 2022 Notes was 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% . (3) Issued in August 2017, effective interest rates of the 2020, 2023, 2024, 2027, 2037, 2047, and 2057 Notes were 2.16% , 2.56% , 2.95% , 3.25% , 3.94% , 4.13% , and 4.33% . (4) Consists of $872 million of 2025 Notes issued in December 2017 in exchange for notes assumed in connection with the acquisition of Whole Foods Market and $128 million of 2025 Notes issued by Whole Foods Market that did not participate in our December 2017 exchange offer. The effective interest rate of the 2025 Notes was 3.02% . |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Stock-Based Compensation Expense | Stock-based compensation expense is as follows (in millions): Three Months Ended Six Months Ended 2018 2019 2018 2019 Cost of sales $ 19 $ 43 $ 34 $ 67 Fulfillment 320 360 564 594 Marketing 190 307 351 516 Technology and content 788 1,077 1,419 1,752 General and administrative 151 184 284 316 Total stock-based compensation expense $ 1,468 $ 1,971 $ 2,652 $ 3,245 |
Nonvested Restricted Stock Units Activity | The following table summarizes our restricted stock unit activity for the six months ended June 30, 2019 (in millions): Number of Units Weighted-Average Grant-Date Fair Value Outstanding as of December 31, 2018 15.9 $ 1,024 Units granted 4.6 1,807 Units vested (3.4 ) 789 Units forfeited (0.9 ) 1,120 Outstanding as of June 30, 2019 16.2 $ 1,287 |
Scheduled Vesting Restricted Stock Unit Activity | Scheduled vesting for outstanding restricted stock units as of June 30, 2019 , is as follows (in millions): Six Months Ended December 31, Year Ended December 31, 2019 2020 2021 2022 2023 Thereafter Total Scheduled vesting—restricted stock units 3.2 6.1 4.9 1.4 0.4 0.2 16.2 |
Changes in Stockholders Equity | The following table shows the changes in stockholders’ equity (in millions): Three Months Ended Six Months Ended 2018 2019 2018 2019 Total beginning stockholders’ equity $ 31,463 $ 48,410 $ 27,709 $ 43,549 Beginning and ending common stock 5 5 5 5 Beginning and ending treasury stock (1,837 ) (1,837 ) (1,837 ) (1,837 ) Beginning additional paid-in capital 22,563 28,059 21,389 26,791 Stock-based compensation and issuance of employee benefit plan stock 1,465 1,976 2,639 3,244 Ending additional paid-in capital 24,028 30,035 24,028 30,035 Beginning accumulated other comprehensive loss (467 ) (1,010 ) (484 ) (1,035 ) Other comprehensive income (loss) (467 ) 50 (450 ) 75 Ending accumulated other comprehensive loss (934 ) (960 ) (934 ) (960 ) Beginning retained earnings 11,199 23,193 8,636 19,625 Cumulative effect of changes in accounting principles (1) — — 934 7 Net income 2,534 2,625 4,163 6,186 Ending retained earnings 13,733 25,818 13,733 25,818 Total ending stockholders’ equity $ 34,995 $ 53,061 $ 34,995 $ 53,061 ___________________ (1) We recorded cumulative effect adjustments related to the new revenue and income tax standards in Q1 2018 and the new lease standard in Q1 2019. See Item 1 of Part I, “Financial Statements — Note 1 — Accounting Policies — Accounting Pronouncements Recently Adopted” for additional information. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Information on Reportable Segments and Reconciliation to Consolidated Net Income | Information on reportable segments and reconciliation to consolidated net income is as follows (in millions): Three Months Ended Six Months Ended 2018 2019 2018 2019 North America Net sales $ 32,169 $ 38,653 $ 62,894 $ 74,465 Operating expenses 30,334 37,089 59,910 70,614 Operating income $ 1,835 $ 1,564 $ 2,984 $ 3,851 International Net sales $ 14,612 $ 16,370 $ 29,487 $ 32,563 Operating expenses 15,106 16,971 30,603 33,253 Operating income (loss) $ (494 ) $ (601 ) $ (1,116 ) $ (690 ) AWS Net sales $ 6,105 $ 8,381 $ 11,547 $ 16,076 Operating expenses 4,463 6,260 8,504 11,733 Operating income $ 1,642 $ 2,121 $ 3,043 $ 4,343 Consolidated Net sales $ 52,886 $ 63,404 $ 103,928 $ 123,104 Operating expenses 49,903 60,320 99,017 115,600 Operating income 2,983 3,084 4,911 7,504 Total non-operating income (expense) (378 ) (195 ) (391 ) (213 ) Provision for income taxes (74 ) (257 ) (361 ) (1,094 ) Equity-method investment activity, net of tax 3 (7 ) 4 (11 ) Net income $ 2,534 $ 2,625 $ 4,163 $ 6,186 |
Disaggregation of Revenue | Net sales by groups of similar products and services, which also have similar economic characteristics, is as follows (in millions): Three Months Ended Six Months Ended 2018 2019 2018 2019 Net Sales: Online stores (1) $ 27,165 $ 31,053 $ 54,105 $ 60,552 Physical stores (2) 4,312 4,330 8,575 8,636 Third-party seller services (3) 9,702 11,962 18,966 23,104 Subscription services (4) 3,408 4,676 6,510 9,018 AWS 6,105 8,381 11,547 16,076 Other (5) 2,194 3,002 4,225 5,718 Consolidated $ 52,886 $ 63,404 $ 103,928 $ 123,104 ____________________________ (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 media products available in both a physical and digital format, such as books, music, videos, 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 Subscription services. (2) Includes product sales where our customers physically select items in a store. Sales from customers who order goods online for delivery or pickup at our physical stores are included in “Online stores.” (3) Includes commissions and any related fulfillment and shipping fees, and other third-party seller services. (4) Includes annual and monthly fees associated with Amazon Prime memberships, as well as audiobook, digital video, e-book, digital music, and other non-AWS subscription services. (5) Primarily includes sales of advertising services, as well as sales related to our other service offerings. |
Accounting Policies - Calculati
Accounting Policies - Calculation of Diluted Shares (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Accounting Policies [Abstract] | ||||
Shares used in computation of basic earnings per share | 493 | 486 | 492 | 485 |
Total dilutive effect of outstanding stock awards | 10 | 14 | 11 | 14 |
Shares used in computation of diluted earnings per share | 503 | 500 | 503 | 499 |
Accounting Policies - Accounts
Accounting Policies - Accounts Receivable, Net and Other (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net and other | $ 16,747 | $ 16,677 |
Customer Receivables, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net and other | 10,600 | 9,400 |
Vendor Receivables, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net and other | 2,600 | 3,200 |
Seller Receivables, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net and other | $ 638 | $ 710 |
Accounting Policies - Leases (D
Accounting Policies - Leases (Details) | 6 Months Ended |
Jun. 30, 2019 | |
Minimum | Equipment | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating and Finance Lease, Term of Contract | 2 years |
Minimum | Property | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating and Finance Lease, Term of Contract | 2 years |
Maximum | Equipment | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating and Finance Lease, Term of Contract | 10 years |
Maximum | Property | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating and Finance Lease, Term of Contract | 20 years |
Accounting Policies - Video and
Accounting Policies - Video and Music Content (Details) - USD ($) $ in Billions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Accounting Policies [Abstract] | |||||
Weighted Average Life, Capitalized Video Content | 2 years 6 months | ||||
Video and Music Content, Capitalized Costs | $ 4.6 | $ 4.6 | $ 3.8 | ||
Video and Music Content, Expense | $ 1.8 | $ 1.6 | $ 3.5 | $ 3.2 |
Accounting Policies - Unearned
Accounting Policies - Unearned Revenue (Details) - USD ($) $ in Billions | 6 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | |
Accounting Policies [Abstract] | ||
Unearned revenue | $ 7.9 | |
Unearned revenue, revenue recognized from beginning balance | $ 4.6 | |
Unearned Revenue, Noncurrent | 1.6 | $ 1.4 |
Remaining performance obligation, contracts exceeding one year | $ 25.1 | |
Remaining performance obligation, expected timing of satisfaction, weighted average remaining life | 3 years 4 months 24 days |
Accounting Policies - Accountin
Accounting Policies - Accounting Pronouncements Recently Adopted (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating Leases, Asset | $ 21,649 | $ 0 | |
Operating Lease, Liability | 22,415 | ||
Accounting Standards Update 2016-02 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating Leases, Asset | $ 21,000 | ||
Operating Lease, Liability | (21,000) | ||
Financing Obligations Reclassified to Operating Leases | $ 1,200 | 1,500 | |
Financing Obligations and Construction Liabilities | 9,600 | ||
Build-to-suit liabilities derecognized | 1,500 | ||
Financing Obligations Reclassified to Finance Leases | $ 5,400 | ||
Accounting Standards Update 2019-02 [Domain] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Incremental Capitalized Film Costs | $ 342 |
Financial Instruments - Fair Va
Financial Instruments - Fair Values on Recurring Basis (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | |
Schedule of Investments [Line Items] | |||
Equity Securities, FV-NI, Unrealized Gain (Loss) | $ 14 | $ 82 | |
Recurring | |||
Schedule of Investments [Line Items] | |||
Cash | 8,553 | 8,553 | $ 10,406 |
Total Estimated Fair Value | |||
Cash, cash equivalents and marketable securities | 41,814 | 41,814 | 41,676 |
Less: Restricted cash, cash equivalents, and marketable securities | (351) | (351) | (426) |
Total cash, cash equivalents, and marketable securities | 41,463 | 41,463 | 41,250 |
Cost or Amortized Cost | |||
Cash, cash equivalents and marketable securities | 41,492 | 41,492 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax | |||
Debt Securities, Available for Sale, Unrealized Gain | 53 | 53 | |
Debt Securities, Available for Sale, Unrealized Loss | (8) | (8) | |
Recurring | Level 1 securities | |||
Total Estimated Fair Value | |||
Equity Securities, FV-NI | 277 | 277 | 170 |
Recurring | Level 1 securities | Money market funds | |||
Schedule of Investments [Line Items] | |||
Money market funds | 10,757 | 10,757 | 12,515 |
Recurring | Level 2 securities | |||
Total Estimated Fair Value | |||
Equity Securities, FV-NI | 0 | 0 | 33 |
Recurring | Level 2 securities | Foreign government and agency securities | |||
Total Estimated Fair Value | |||
Debt Securities, Available for Sale, Fair Value | 1,596 | 1,596 | 815 |
Cost or Amortized Cost | |||
Debt Securities, Available for Sale, Cost | 1,596 | 1,596 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax | |||
Debt Securities, Available for Sale, Unrealized Gain | 0 | 0 | |
Debt Securities, Available for Sale, Unrealized Loss | 0 | 0 | |
Recurring | Level 2 securities | U.S. government and agency securities | |||
Total Estimated Fair Value | |||
Debt Securities, Available for Sale, Fair Value | 8,581 | 8,581 | 11,667 |
Cost or Amortized Cost | |||
Debt Securities, Available for Sale, Cost | 8,573 | 8,573 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax | |||
Debt Securities, Available for Sale, Unrealized Gain | 13 | 13 | |
Debt Securities, Available for Sale, Unrealized Loss | (5) | (5) | |
Recurring | Level 2 securities | Corporate debt securities | |||
Total Estimated Fair Value | |||
Debt Securities, Available for Sale, Fair Value | 9,944 | 9,944 | 4,990 |
Cost or Amortized Cost | |||
Debt Securities, Available for Sale, Cost | 9,915 | 9,915 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax | |||
Debt Securities, Available for Sale, Unrealized Gain | 31 | 31 | |
Debt Securities, Available for Sale, Unrealized Loss | (2) | (2) | |
Recurring | Level 2 securities | Asset-backed securities | |||
Total Estimated Fair Value | |||
Debt Securities, Available for Sale, Fair Value | 1,840 | 1,840 | 892 |
Cost or Amortized Cost | |||
Debt Securities, Available for Sale, Cost | 1,834 | 1,834 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax | |||
Debt Securities, Available for Sale, Unrealized Gain | 7 | 7 | |
Debt Securities, Available for Sale, Unrealized Loss | (1) | (1) | |
Recurring | Level 2 securities | Other fixed income securities | |||
Total Estimated Fair Value | |||
Debt Securities, Available for Sale, Fair Value | 266 | 266 | $ 188 |
Cost or Amortized Cost | |||
Debt Securities, Available for Sale, Cost | 264 | 264 | |
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax | |||
Debt Securities, Available for Sale, Unrealized Gain | 2 | 2 | |
Debt Securities, Available for Sale, Unrealized Loss | $ 0 | $ 0 |
Financial Instruments - Contrac
Financial Instruments - Contractual Maturities (Details) $ in Millions | Jun. 30, 2019USD ($) |
Amortized Cost | |
Due within one year | $ 24,249 |
Due after one year through five years | 7,428 |
Due after five years through ten years | 296 |
Due after ten years | 966 |
Cash Equivalents and Marketable Fixed Income Securities, Cost | 32,939 |
Estimated Fair Value | |
Due within one year | 24,255 |
Due after one year through five years | 7,467 |
Due after five years through ten years | 296 |
Due after ten years | 966 |
Cash Equivalents and Marketable Fixed Income Securities, Fair Value | $ 32,984 |
Financial Instruments - Equity
Financial Instruments - Equity Warrant Assets and Non-Marketable Equity Securities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Investments, Warrant Assets and Non-Marketable Equity Securities | |||||
Equity Securities without Readily Determinable Fair Value, Amount | $ 888 | $ 888 | $ 282 | ||
Warrant | |||||
Investments, Warrant Assets and Non-Marketable Equity Securities | |||||
Gain (loss) on warrant assets | (16) | $ 40 | 73 | $ 86 | |
Warrant | Level 2 assets | |||||
Investments, Warrant Assets and Non-Marketable Equity Securities | |||||
Fair value of warrant assets | $ 613 | $ 613 | $ 440 |
Financial Instruments - Reconci
Financial Instruments - Reconciliation to Cash Flow (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2017 |
Investments, Debt and Equity Securities [Abstract] | |||||||
Cash and cash equivalents | $ 22,616 | $ 31,750 | |||||
Restricted cash included in accounts receivable, net and other | 318 | 418 | |||||
Restricted cash included in other assets | 31 | 5 | |||||
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 22,965 | $ 23,507 | $ 32,173 | $ 20,536 | $ 17,616 | $ 21,856 | $ 13,851 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Billions | Jun. 30, 2019 | Dec. 31, 2018 |
Leases [Abstract] | ||
Finance Lease, Right-of-Use Asset | $ 50.3 | $ 36.1 |
Finance Lease, Right-of-Use-Asset, Accumulated Amortization | $ 25.4 | $ 19.8 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Leases [Abstract] | ||||
Operating lease cost | $ 874 | $ 1,710 | ||
Finance lease amortization of lease assets | 2,402 | 4,709 | ||
Finance lease interest on lease liabilities | 160 | 316 | ||
Finance lease cost | 2,562 | 5,025 | ||
Variable lease cost | 281 | 531 | ||
Total lease cost | $ 3,717 | $ 7,266 | ||
Rental expense under operating lease agreements | $ 815 | $ 1,600 |
Leases - Other Operating and Fi
Leases - Other Operating and Finance Lease Information (Details) | Jun. 30, 2019 |
Leases [Abstract] | |
Weighted-average remaining lease term – operating leases | 11 years 2 months 12 days |
Weighted-average remaining lease term – finance leases | 5 years 8 months 12 days |
Weighted-average discount rate – operating leases | 3.20% |
Weighted-average discount rate – finance leases | 2.90% |
Leases - Operating and Finance
Leases - Operating and Finance Lease Liability Reconciliation (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Leases [Abstract] | ||
Gross lease liabilities - operating leases | $ 28,739 | |
Gross lease liabilities - finance leases | 26,204 | |
Gross lease liabilities | 54,943 | |
Imputed interest - operating leases | (6,324) | |
Imputed interest - finance leases | (1,970) | |
Imputed interest | (8,294) | |
Present value of operating leases | 22,415 | |
Present value of finance leases | 24,234 | |
Present value of lease liabilities | 46,649 | |
Current portion of operating lease liabilities | (2,631) | |
Current portion of finance lease liabilities | (8,884) | |
Current portion of lease liabilities | (11,515) | |
Total long-term operating lease liabilities | 19,784 | |
Total long-term finance lease liabilities | 15,350 | |
Total long-term lease liabilities | $ 35,134 | $ 9,650 |
Commitments and Contingencies -
Commitments and Contingencies - Principal Contractual Commitments Excluding Open Orders (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Debt principal and interest | ||
Six Months Ended December 31, 2019 | $ 1,816 | |
Year Ended December 31, 2020 | 2,162 | |
Year Ended December 31, 2021 | 1,887 | |
Year Ended December 31, 2022 | 2,103 | |
Year Ended December 31, 2023 | 1,807 | |
Thereafter | 30,020 | |
Total | 39,795 | |
Operating leases | ||
Six Months Ended December 31, 2019 | 1,632 | |
Year Ended December 31, 2020 | 3,377 | |
Year Ended December 31, 2021 | 3,102 | |
Year Ended December 31, 2022 | 2,744 | |
Year Ended December 31, 2023 | 2,438 | |
Thereafter | 15,446 | |
Gross lease liabilities - operating leases | 28,739 | |
Finance lease liabilities, including interest | ||
Six Months Ended December 31, 2019 | 4,319 | |
Year Ended December 31, 2020 | 8,418 | |
Year Ended December 31, 2021 | 5,359 | |
Year Ended December 31, 2022 | 1,961 | |
Year Ended December 31, 2023 | 1,026 | |
Thereafter | 5,121 | |
Gross lease liabilities - finance leases | 26,204 | |
Financing obligations, including interest | ||
Six Months Ended December 31, 2019 | 18 | |
Year Ended December 31, 2020 | 44 | |
Year Ended December 31, 2021 | 45 | |
Year Ended December 31, 2022 | 45 | |
Year Ended December 31, 2023 | 46 | |
Thereafter | 703 | |
Total | 901 | |
Unconditional purchase obligations | ||
Six Months Ended December 31, 2019 | 1,176 | |
Year Ended December 31, 2020 | 3,416 | |
Year Ended December 31, 2021 | 3,464 | |
Year Ended December 31, 2022 | 3,167 | |
Year Ended December 31, 2023 | 3,002 | |
Thereafter | 5,253 | |
Total | 19,478 | |
Other commitments | ||
Six Months Ended December 31, 2019 | 1,296 | |
Year Ended December 31, 2020 | 2,498 | |
Year Ended December 31, 2021 | 1,871 | |
Year Ended December 31, 2022 | 1,676 | |
Year Ended December 31, 2023 | 1,129 | |
Thereafter | 11,057 | |
Total | 19,527 | |
Accrued tax contingencies | 3,700 | $ 3,400 |
Total commitments | ||
Six Months Ended December 31, 2019 | 10,257 | |
Year Ended December 31, 2020 | 19,915 | |
Year Ended December 31, 2021 | 15,728 | |
Year Ended December 31, 2022 | 11,696 | |
Year Ended December 31, 2023 | 9,448 | |
Thereafter | 67,600 | |
Total | $ 134,644 |
Commitments and Contingencies_2
Commitments and Contingencies - Pledged Assets (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Commitments and Contingencies Disclosure [Abstract] | ||
Pledged assets | $ 586 | $ 575 |
Debt - Additional Information (
Debt - Additional Information (Details) | 1 Months Ended | |||
Apr. 30, 2018USD ($)extension | Oct. 31, 2016USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($) | |
Debt Instrument [Line Items] | ||||
Borrowings outstanding | $ 25,066,000,000 | $ 24,965,000,000 | ||
Face value of long-term debt | 23,430,000,000 | 23,594,000,000 | ||
Commercial Paper | ||||
Debt Instrument [Line Items] | ||||
Credit term | 397 days | |||
Commercial Paper | 0 | 0 | ||
Commercial Paper, Maximum Borrowing Capacity | $ 7,000,000,000 | |||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Unamortized Discount (Premium), Net | 101,000,000 | 101,000,000 | ||
Borrowings outstanding | 24,300,000,000 | |||
Estimated fair value of notes | 26,600,000,000 | 24,300,000,000 | ||
Senior Notes | 5.200% Notes due on December 3, 2025 | ||||
Debt Instrument [Line Items] | ||||
Borrowings outstanding | 1,000,000,000 | 1,000,000,000 | ||
Credit Facility | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Borrowings outstanding | 509,000,000 | 594,000,000 | ||
Credit Facility | Revolving Credit Facility | October 2016 Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Revolving credit maximum borrowing capacity | $ 500,000,000 | 620,000,000 | ||
Credit term | 3 years | |||
Commitment fee percentage | 0.50% | |||
Borrowings outstanding | $ 509,000,000 | $ 594,000,000 | ||
Weighted average interest rate | 3.40% | 3.20% | ||
Collateral amount | $ 590,000,000 | $ 686,000,000 | ||
Credit Facility | Revolving Credit Facility | October 2016 Revolving Credit Facility | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate (as a percent) | 1.65% | |||
Credit Facility | Revolving Credit Facility | April 2018 Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Revolving credit maximum borrowing capacity | $ 7,000,000,000 | |||
Credit term | 3 years | |||
Line Of Credit Facility, Number Of Extensions | extension | 3 | |||
Line Of Credit Facility, Additional Term | 1 year | |||
Commitment fee percentage | 0.04% | |||
Borrowings outstanding | 0 | 0 | ||
Credit Facility | Revolving Credit Facility | April 2018 Revolving Credit Facility | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate (as a percent) | 0.50% | |||
Amazon.com, Inc. | 5.200% Notes due on December 3, 2025 | ||||
Debt Instrument [Line Items] | ||||
Borrowings outstanding | 872,000,000 | |||
Whole Foods Market, Inc. | 5.200% Notes due on December 3, 2025 | ||||
Debt Instrument [Line Items] | ||||
Borrowings outstanding | 128,000,000 | |||
Line of Credit and Other Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Borrowings outstanding | 816,000,000 | 715,000,000 | ||
Other Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Borrowings outstanding | $ 307,000,000 | $ 121,000,000 | ||
Weighted average interest rate | 5.20% | 6.00% |
Debt - Long-Term Debt Obligatio
Debt - Long-Term Debt Obligations (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 | Apr. 30, 2018 | Oct. 31, 2016 |
Debt Instrument [Line Items] | ||||
Total debt | $ 25,066,000,000 | $ 24,965,000,000 | ||
Less current portion of long-term debt | (1,636,000,000) | (1,371,000,000) | ||
Face value of long-term debt | 23,430,000,000 | 23,594,000,000 | ||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Total debt | $ 24,300,000,000 | |||
Senior Notes | 2.600% Notes due on December 5, 2019 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 2.60% | |||
Total debt | $ 1,000,000,000 | 1,000,000,000 | ||
Effective interest rates | 2.73% | |||
Senior Notes | 1.900% Notes due on August 21, 2020 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 1.90% | |||
Total debt | $ 1,000,000,000 | 1,000,000,000 | ||
Effective interest rates | 2.16% | |||
Senior Notes | 3.300% Notes due on December 5, 2021 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 3.30% | |||
Total debt | $ 1,000,000,000 | 1,000,000,000 | ||
Effective interest rates | 3.43% | |||
Senior Notes | 2.500% Notes due on November 29, 2022 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 2.50% | |||
Total debt | $ 1,250,000,000 | 1,250,000,000 | ||
Effective interest rates | 2.66% | |||
Senior Notes | 2.400% Notes due on February 22, 2023 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 2.40% | |||
Total debt | $ 1,000,000,000 | 1,000,000,000 | ||
Effective interest rates | 2.56% | |||
Senior Notes | 2.800% Notes due on August 22, 2024 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 2.80% | |||
Total debt | $ 2,000,000,000 | 2,000,000,000 | ||
Effective interest rates | 2.95% | |||
Senior Notes | 3.800% Notes due on December 5, 2024 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 3.80% | |||
Total debt | $ 1,250,000,000 | 1,250,000,000 | ||
Effective interest rates | 3.90% | |||
Senior Notes | 5.200% Notes due on December 3, 2025 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 5.20% | |||
Total debt | $ 1,000,000,000 | 1,000,000,000 | ||
Effective interest rates | 3.02% | |||
Senior Notes | 3.150% Notes due on August 22, 2027 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 3.15% | |||
Total debt | $ 3,500,000,000 | 3,500,000,000 | ||
Effective interest rates | 3.25% | |||
Senior Notes | 4.800% Notes due on December 5, 2034 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.80% | |||
Total debt | $ 1,250,000,000 | 1,250,000,000 | ||
Effective interest rates | 4.92% | |||
Senior Notes | 3.875% Notes due on August 22, 2037 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 3.875% | |||
Total debt | $ 2,750,000,000 | 2,750,000,000 | ||
Effective interest rates | 3.94% | |||
Senior Notes | 4.950% Notes due on December 5, 2044 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.95% | |||
Total debt | $ 1,500,000,000 | 1,500,000,000 | ||
Effective interest rates | 5.11% | |||
Senior Notes | 4.050% Notes due on August 22, 2047 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.05% | |||
Total debt | $ 3,500,000,000 | 3,500,000,000 | ||
Effective interest rates | 4.13% | |||
Senior Notes | 4.250% Notes due on August 22, 2057 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 4.25% | |||
Total debt | $ 2,250,000,000 | 2,250,000,000 | ||
Effective interest rates | 4.33% | |||
Credit Facility | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Total debt | $ 509,000,000 | 594,000,000 | ||
Credit Facility | October 2016 Revolving Credit Facility | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Revolving credit maximum borrowing capacity | 620,000,000 | $ 500,000,000 | ||
Credit Facility | April 2018 Revolving Credit Facility | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Revolving credit maximum borrowing capacity | $ 7,000,000,000 | |||
Other long-term debt | ||||
Debt Instrument [Line Items] | ||||
Total debt | $ 307,000,000 | $ 121,000,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) shares in Millions | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Feb. 29, 2016 | |
Class of Stock [Line Items] | ||||
Common shares outstanding plus underlying outstanding stock awards | 510 | 507 | ||
Net unrecognized compensation cost related to unvested stock-based compensation arrangements | $ 9,400,000,000 | |||
Compensation cost expected to be expensed in next twelve months, percentage | 50.00% | |||
Net unrecognized compensation cost related to unvested stock-based compensation arrangements, weighted average recognition period (in years) | 1 year 1 month 6 days | |||
Estimated forfeiture rate | 27.00% | 27.00% | ||
February 2016 Program | ||||
Class of Stock [Line Items] | ||||
Stock repurchase, authorized amount | $ 5,000,000,000 | |||
Stock Repurchased During Period, Value | $ 0 | $ 0 |
Stockholders' Equity - Stock-ba
Stockholders' Equity - Stock-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | $ 1,971 | $ 1,468 | $ 3,245 | $ 2,652 |
Cost of sales | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 43 | 19 | 67 | 34 |
Fulfillment | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 360 | 320 | 594 | 564 |
Marketing | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 307 | 190 | 516 | 351 |
Technology and content | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 1,077 | 788 | 1,752 | 1,419 |
General and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | $ 184 | $ 151 | $ 316 | $ 284 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock Unit Activity (Details) - Restricted Stock Units shares in Millions | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Number of Units | |
Beginning balance (in shares) | shares | 15.9 |
Units granted (in shares) | shares | 4.6 |
Units vested (in shares) | shares | (3.4) |
Units forfeited (in shares) | shares | (0.9) |
Ending balance (in shares) | shares | 16.2 |
Weighted-Average Grant-Date Fair Value | |
Outstanding as of December 31, 2018 | $ / shares | $ 1,024 |
Units granted | $ / shares | 1,807 |
Units vested | $ / shares | 789 |
Units forfeited | $ / shares | 1,120 |
Outstanding as of June 30, 2019 | $ / shares | $ 1,287 |
Stockholders' Equity - Schedule
Stockholders' Equity - Scheduled Vesting for Outstanding Restricted Stock Units (Details) - Restricted Stock Units - shares shares in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Six Months Ended December 31, 2019 | 3.2 | |
Year Ended December 31, 2020 | 6.1 | |
Year Ended December 31, 2021 | 4.9 | |
Year Ended December 31, 2022 | 1.4 | |
Year Ended December 31, 2023 | 0.4 | |
Thereafter | 0.2 | |
Total | 16.2 | 15.9 |
Stockholders' Equity - Changes
Stockholders' Equity - Changes in Stockholders Equity (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Apr. 01, 2019 | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Apr. 01, 2018 | Mar. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | |
Stockholders' equity | $ 53,061 | $ 34,995 | $ 53,061 | $ 34,995 | $ 53,061 | $ 34,995 | $ 48,410 | $ 43,549 | $ 31,463 | $ 27,709 | ||||
Other comprehensive income (loss) | 50 | (467) | 75 | (450) | ||||||||||
Net Income | 2,625 | 2,534 | 6,186 | 4,163 | 12,096 | 6,275 | ||||||||
Common stock | ||||||||||||||
Stockholders' equity | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | ||||
Treasury stock | ||||||||||||||
Stockholders' equity | (1,837) | (1,837) | (1,837) | (1,837) | (1,837) | (1,837) | (1,837) | (1,837) | (1,837) | (1,837) | ||||
Additional paid-in capital | ||||||||||||||
Stockholders' equity | 30,035 | 24,028 | 30,035 | 24,028 | 30,035 | 24,028 | 28,059 | 26,791 | 22,563 | 21,389 | ||||
Stock-based compensation and issuance of employee benefit plan stock | 1,976 | 1,465 | 3,244 | 2,639 | ||||||||||
Accumulated other comprehensive income (loss) | ||||||||||||||
Stockholders' equity | (960) | (934) | (960) | (934) | (960) | (934) | (1,010) | (1,035) | (467) | (484) | ||||
Other comprehensive income (loss) | 50 | (467) | 75 | (450) | ||||||||||
Retained earnings | ||||||||||||||
Stockholders' equity | 25,818 | 13,733 | 25,818 | 13,733 | $ 25,818 | $ 13,733 | $ 23,193 | $ 19,625 | $ 11,199 | $ 8,636 | ||||
Cumulative effect of changes in accounting principles | $ 0 | $ 7 | $ 0 | $ 934 | ||||||||||
Net Income | $ 2,625 | $ 2,534 | $ 6,186 | $ 4,163 |
Income Taxes - Income Taxes (De
Income Taxes - Income Taxes (Details) € in Millions, $ in Millions | Oct. 04, 2017EUR (€) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) |
Income Tax Disclosure [Abstract] | ||||||||
Provision for income taxes | $ 257 | $ 74 | $ 1,094 | $ 361 | ||||
Discrete tax benefits | 706 | 964 | ||||||
Cash taxes paid, net of refunds | 283 | $ 300 | 451 | $ 813 | $ 822 | $ 1,077 | ||
Tax contingencies | $ 3,700 | 3,700 | $ 3,700 | $ 3,400 | ||||
Internal Revenue Service (IRS) | Domestic Tax Authority [Member] | ||||||||
Income Tax Examination [Line Items] | ||||||||
Tax examination, estimate of additional tax expense | $ 1,500 | |||||||
Luxembourg Tax Administration [Member] | Foreign Tax Authority [Member] | ||||||||
Income Tax Examination [Line Items] | ||||||||
Tax examination, estimate of additional tax expense | € | € 250 |
Segment Information - Reportabl
Segment Information - Reportable Segments and Reconciliation to Consolidated Net Income (Details) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)segment | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | |
Segment Reporting [Abstract] | ||||||
Number of operating segments | segment | 3 | |||||
Segment Reporting Disclosure [Line Items] | ||||||
Net sales | $ 63,404 | $ 52,886 | $ 123,104 | $ 103,928 | ||
Operating expenses | 60,320 | 49,903 | 115,600 | 99,017 | ||
Operating income (loss) | 3,084 | 2,983 | 7,504 | 4,911 | ||
Total non-operating income (expense) | (195) | (378) | (213) | (391) | ||
Provision for income taxes | (257) | (74) | (1,094) | (361) | ||
Equity-method investment activity, net of tax | (7) | 3 | (11) | 4 | ||
Net income | 2,625 | 2,534 | 6,186 | 4,163 | $ 12,096 | $ 6,275 |
North America | ||||||
Segment Reporting Disclosure [Line Items] | ||||||
Net sales | 38,653 | 32,169 | 74,465 | 62,894 | ||
Operating expenses | 37,089 | 30,334 | 70,614 | 59,910 | ||
Operating income (loss) | 1,564 | 1,835 | 3,851 | 2,984 | ||
International | ||||||
Segment Reporting Disclosure [Line Items] | ||||||
Net sales | 16,370 | 14,612 | 32,563 | 29,487 | ||
Operating expenses | 16,971 | 15,106 | 33,253 | 30,603 | ||
Operating income (loss) | (601) | (494) | (690) | (1,116) | ||
AWS | ||||||
Segment Reporting Disclosure [Line Items] | ||||||
Net sales | 8,381 | 6,105 | 16,076 | 11,547 | ||
Operating expenses | 6,260 | 4,463 | 11,733 | 8,504 | ||
Operating income (loss) | $ 2,121 | $ 1,642 | $ 4,343 | $ 3,043 |
Segment Information - Disaggreg
Segment Information - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 63,404 | $ 52,886 | $ 123,104 | $ 103,928 |
Online stores | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 31,053 | 27,165 | 60,552 | 54,105 |
Physical stores | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 4,330 | 4,312 | 8,636 | 8,575 |
Third-party seller services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 11,962 | 9,702 | 23,104 | 18,966 |
Subscription services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 4,676 | 3,408 | 9,018 | 6,510 |
AWS | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | 8,381 | 6,105 | 16,076 | 11,547 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net sales | $ 3,002 | $ 2,194 | $ 5,718 | $ 4,225 |