Q4 2013 Financial Results Conference Call Slides

This presentation may contain forward-looking statements which are inherently difficult to predict. Actual results could differ materially for a variety of reasons, including fluctuations in foreign exchange rates, changes in global economic conditions and consumer spending, world events, the rate of growth of the Internet and online commerce, the amount that Amazon.com invests in new business opportunities and the timing of those investments, the mix of products sold to customers, the mix of net sales derived from products as compared with services, the extent to which we owe income taxes, competition, management of growth, potential fluctuations in operating results, international growth and expansion, the outcomes of legal proceedings and claims, fulfillment and data center optimization, risks of inventory management, seasonality, the degree to which the Company enters into, maintains, and develops commercial agreements, acquisitions and strategic transactions, payments risks, and risks of fulfillment throughput and productivity. Other risks and uncertainties include, among others, risks related to new products, services, and technologies, system interruptions, government regulation and taxation, and fraud. In addition, the current global economic climate amplifies many of these risks. More information about factors that potentially could affect Amazon.com’s financial results is included in Amazon.com’s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and subsequent filings.

Additional information relating to certain of our financial measures contained herein is available in the appendix to our presentation, our most recent earnings release and at our website at www.amazon.com/ir.

2

Free Cash Flow -- TTM (1)

(1) Free Cash Flow, a non-GAAP financial measure, is GAAP Operating Cash Flow Less Purchases of Property and Equipment. See appendix for a reconciliation of Operating Cash Flow to Free Cash Flow.

Long Term Goal – Optimize Free Cash Flow

MM

3

$395MM

$2,031MM

$0

$2,000

$4,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

454 459

16 17

0

300

600

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Common Shares Outstanding Stock-Based Awards Outstanding

470 476

Efficiently Managing Dilution

MM Shares

4

4%

13%

0%

10%

20%

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Return on Invested Capital -- TTM (1)

(1) ROIC = TTM Free Cash Flow divided by average Total Assets minus Current Liabilities, excluding current portion of our Long-Term Debt, over 5 quarter ends.

Efficient Capital Structure

5

$21,268MM

$25,587MM

$0

$20,000

$40,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Net Sales

Up 20% Y/Y (22% F/X Adjusted)

MM

6

$61,093MM

$74,452MM

$0

$50,000

$100,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Up 22% Y/Y; 24% F/X Adjusted

Net Sales -- TTM

66% of WW TTM Revenue from EGM, Up from 63% Y/Y

MM

7

WW Media

WW Electronics & Other General Merchandise(EGM)

WW Other

WW Revenue MixWW Revenue Mix

66%

5%

29%

$48,802MM

$3,934MM

$21,716MM

$405MM

$510MM

-$100

$300

$700

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

MM

GAAP Operating Income (Loss)

8

$676MM$745MM

$0

$500

$1,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

MM

GAAP Operating Income – TTM

9

$678MM

$876MM

$0

$600

$1,200

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Up 29% Y/Y

MM

Consolidated Segment Operating Income (1)

(1) Consolidated Segment Operating Income (CSOI), a non-GAAP financial measure, excludes Stock-Based Compensation and Other Operating Income (Expense). See appendix for a reconciliation of CSOI to GAAP Operating Income.

10

$1,668MM

$1,993MM

$0

$1,500

$3,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Up 20% Y/Y

MM

Consolidated Segment Operating Income -- TTM (1)

(1) Consolidated Segment Operating Income (CSOI), a non-GAAP financial measure, excludes Stock-Based Compensation and Other Operating Income (Expense). See appendix for a reconciliation of CSOI to GAAP Operating Income.

11

$97MM

$239MM

-$100

$0

$100

$200

$300

$400

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

MM

GAAP Net Income (Loss)

12

Segment Results – North America

TTM Net Sales $44.5B

MM

(1) A majority of our costs for "Technology and Content" are incurred in the United States and most of these costs are allocated to our North America segment.

$608MM

$725MM

$0

$500

$1,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Operating Income (1)

Up 19% Y/Y

MM

13

$12,175MM

$15,331MM

$0

$10,000

$20,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Net Sales

Up 26% Y/Y

$9,093MM

$10,256MM

$0

$5,000

$10,000

$15,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Net Sales

Up 13% Y/Y; up 15% F/X adjusted

Segment Results – International

TTM Net Sales $29.9B

MM

$70MM

$151MM

-$75

$0

$75

$150

$225

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Operating Income (Loss)

Up 116% Y/Y; up 119% F/X adjusted

MM

14

$2,903MM

$3,513MM

$0

$2,500

$5,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

North America

Up 21% Y/Y

Supplemental Revenue Highlights – Media

Books, Music, Movies, Video Games and Consoles, Software, and Digital Downloads

MM

15

$3,611MM $3,714MM

$0

$2,500

$5,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

International

Up 3% Y/Y; Up 6% F/X adjusted

MM

$8,503MM

$10,648MM

$0

$7,000

$14,000

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

North America

Up 25% Y/Y

Supplemental Revenue Highlights – Electronics & Other General Merchandise (EGM)

Computers and Office, Electronics, Home and Garden, Grocery, Health and Beauty, Toys, Kids and Baby, Apparel, Shoes and Jewelry, Sports and Outdoors, Tools, Auto and Industrial, and

Digital Devices

MM

$5,431MM

$6,478MM

$0

$4,500

$9,000

Q4 '12 Q1 '13 Q2 '13 Q2 '13 Q4 '13

International

Up 19% Y/Y; 21% F/X adjusted

MM

16

$769MM

$1,170MM

$0

$750

$1,500

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

North America

Up 52% Y/Y

Supplemental Revenue Highlights – Other

Amazon Web Services (North America), Advertising Services, and Co-branded Credit Cards

MM

$51MM

$64MM

$0

$40

$80

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

International

Up 25% Y/Y; 27% F/X adjusted

MM

17

Appendix

18

Free Cash Flow Reconciliation -- TTM

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13

Operating Cash Flow $ 4,180 $ 4,245 $ 4,532 $ 4,977 $ 5,475

Purchases of Property and Equipment, Including Internal-Use Software and Website Development

(3,785)

(4,068)

(4,267)

(4,589)

(3,444)

Free Cash Flow $ 395 $ 177 $ __265 $ __388 $ 2,031

$MM

19

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Consolidated Segment Operating Income $ 678 $ 441 $ 409 $ 267 $ 876

Stock-Based Compensation (235) (229) (298) (281) (326)

Other Operating Income (Expense), Net (38) (31) (32) (11) (40)

GAAP Operating Income (Loss) $ 405 $ 181 $ 79 $ (25) $ 510

Consolidated Segment Operating Income Reconciliation

$MM

20

Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Consolidated Segment Operating Income $ 1,668 $ 1,711 $ 1,760 $ 1,795 $ 1,993

Stock-Based Compensation (833) (901) (978)

(1,043)

(1,134)

Other Operating Income (Expense), Net (159) (145) (145) (112) (114)

GAAP Operating Income $ 676 $ 665 $ 637 $ 640 $ 745

Consolidated Segment Operating Income Reconciliation -- TTM

$MM

21