AMAZON COM INC, 10-Q filed on 4/26/2019
Quarterly Report
v3.19.1
Document and Entity Information - shares
3 Months Ended
Mar. 31, 2019
Apr. 17, 2019
Document And Entity Information [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Mar. 31, 2019  
Document Fiscal Year Focus 2019  
Document Fiscal Period Focus Q1  
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 Small Business false  
Entity Common Stock, Shares Outstanding   492,331,776
v3.19.1
Consolidated Statements of Cash Flows - USD ($)
$ in Millions
3 Months Ended 12 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Mar. 31, 2019
Mar. 31, 2018
Statement of Cash Flows [Abstract]        
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD $ 32,173 $ 21,856 $ 17,616 $ 16,301
OPERATING ACTIVITIES:        
Net income 3,561 1,629 12,005 3,938
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 4,854 3,671 16,524 12,714
Stock-based compensation 1,274 1,182 5,509 4,605
Other operating expense (income), net (13) 56 205 216
Other expense (income), net (135) (184) 268 (437)
Deferred income taxes 415 141 714 134
Changes in operating assets and liabilities:        
Inventories 719 2,220 (2,815) (2,309)
Accounts receivable, net and other (401) 1,029 (6,043) (4,716)
Accounts payable (6,384) (10,216) 7,095 3,749
Accrued expenses and other (2,932) (2,225) (235) (538)
Unearned revenue 888 906 1,133 838
Net cash provided by (used in) operating activities 1,846 (1,791) 34,360 18,194
INVESTING ACTIVITIES:        
Purchases of property and equipment (3,290) (3,098) (13,619) (12,905)
Proceeds from property and equipment incentives 569 371 2,303 1,981
Acquisitions, net of cash acquired, and other (1,169) (13) (3,342) (13,939)
Sales and maturities of marketable securities 2,643 2,677 8,205 10,444
Purchases of marketable securities (6,876) (470) (13,506) (11,846)
Net cash provided by (used in) investing activities (8,123) (533) (19,959) (26,265)
FINANCING ACTIVITIES:        
Proceeds from long-term debt and other 190 125 833 16,332
Repayments of long-term debt and other (351) (202) (817) (1,463)
Principal repayments of finance leases (2,214) (2,015) (7,649) (5,981)
Principal repayments of financing obligations (2) (72) (266) (235)
Net cash provided by (used in) financing activities (2,377) (2,164) (7,899) 8,653
Foreign currency effect on cash, cash equivalents, and restricted cash (12) 248 (611) 733
Net increase (decrease) in cash, cash equivalents, and restricted cash (8,666) (4,240) 5,891 1,315
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD 23,507 17,616 23,507 17,616
SUPPLEMENTAL CASH FLOW INFORMATION:        
Cash paid for interest on long-term debt 286 282 858 607
Cash paid for operating leases 709 0 709 0
Cash paid for interest on finance leases 165 75 471 234
Cash paid for interest on financing obligations 2 54 142 153
Cash paid for income taxes, net of refunds 168 513 840 1,224
Assets acquired under operating leases 875 0 875 0
Property and equipment acquired under finance leases 2,628 2,270 10,972 10,020
Property and equipment acquired under build-to-suit arrangements $ 436 $ 741 $ 3,336 $ 3,081
v3.19.1
Consolidated Statements of Operations - USD ($)
shares in Millions, $ in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Total net sales $ 59,700 $ 51,042
Operating expenses:    
Cost of sales 33,920 30,735
Fulfillment 8,601 7,792
Marketing 3,664 2,699
Technology and content 7,927 6,759
General and administrative 1,173 1,067
Other operating expense, net   63
Other operating income, net (5)  
Total operating expenses 55,280 49,115
Operating income 4,420 1,927
Interest income 183 80
Interest expense (366) (330)
Other income (expense), net 164 239
Total non-operating income (expense) (19) (11)
Income before income taxes 4,401 1,916
Provision for income taxes (836) (287)
Equity-method investment activity, net of tax (4) 0
Net income $ 3,561 $ 1,629
Basic earnings per share $ 7.24 $ 3.36
Diluted earnings per share $ 7.09 $ 3.27
Weighted-average shares used in computation of earnings per share:    
Basic (in shares) 491 484
Diluted (in shares) 502 498
Product [Member]    
Total net sales $ 34,283 $ 31,605
Service [Member]    
Total net sales $ 25,417 $ 19,437
v3.19.1
Consolidated Statements of Comprehensive Income - USD ($)
$ in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Statement of Comprehensive Income [Abstract]    
Net income $ 3,561 $ 1,629
Other comprehensive income (loss):    
Foreign currency translation adjustments, net of tax of $21 and $(1) (8) 59
Net change in unrealized gains (losses) on available-for-sale debt securities:    
Unrealized gains (losses), net of tax of $9 and $0 32 (44)
Reclassification adjustment for losses (gains) included in “Other income (expense), net,” net of tax of $0 and $0 1 2
Net unrealized gains (losses) on available-for-sale debt securities 33 (42)
Total other comprehensive income (loss) 25 17
Comprehensive income $ 3,586 $ 1,646
v3.19.1
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($)
$ in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Statement of Comprehensive Income [Abstract]    
Foreign currency translation adjustments, tax $ (1) $ 21
Unrealized gains (losses), tax 0 9
Reclassification adjustment for losses (gains) included in “Other income (expense), net,” tax $ 0 $ 0
v3.19.1
Consolidated Balance Sheets - USD ($)
$ in Millions
Mar. 31, 2019
Dec. 31, 2018
Current assets:    
Cash and cash equivalents $ 23,115 $ 31,750
Marketable securities 13,905 9,500
Inventories 16,432 17,174
Accounts receivable, net and other 15,979 16,677
Total current assets 69,431 75,101
Property and equipment, net 61,048 61,797
Operating leases 20,132 0
Goodwill 14,708 14,548
Other assets 12,783 11,202
Total assets 178,102 162,648
Current liabilities:    
Accounts payable 31,809 38,192
Accrued expenses and other 24,588 23,663
Unearned revenue 7,298 6,536
Total current liabilities 63,695 68,391
Long-term lease liabilities 33,275 9,650
Long-term debt 23,322 23,495
Other long-term liabilities 9,400 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 516 Outstanding shares - 491 and 492 5 5
Treasury stock, at cost (1,837) (1,837)
Additional paid-in capital 28,059 26,791
Accumulated other comprehensive loss (1,010) (1,035)
Retained earnings 23,193 19,625
Total stockholders’ equity 48,410 43,549
Total liabilities and stockholders’ equity $ 178,102 $ 162,648
v3.19.1
Consolidated Balance Sheets (Parenthetical) - $ / shares
Mar. 31, 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 516,000,000 514,000,000
Common stock, outstanding shares 492,000,000 491,000,000
v3.19.1
Accounting Policies
3 Months Ended
Mar. 31, 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 balance sheets, operating results, and cash flows for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 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
March 31,
 
2018
 
2019
Shares used in computation of basic earnings per share
484

 
491

Total dilutive effect of outstanding stock awards
14

 
11

Shares used in computation of diluted earnings per share
498

 
502


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 March 31, 2019, customer receivables, net, were $9.4 billion and $9.8 billion, vendor receivables, net, were $3.2 billion and $2.5 billion, and seller receivables, net, were $710 million and $660 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 2.6 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 March 31, 2019 were $3.8 billion and $4.2 billion. Total video and music expense was $1.5 billion and $1.7 billion in Q1 2018 and Q1 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 $2.8 billion was recognized as revenue during the three months ended March 31, 2019. Included in “Other long-term liabilities” on our consolidated balance sheets was $1.4 billion of unearned revenue as of December 31, 2018 and March 31, 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 $21.6 billion as of March 31, 2019. The weighted average remaining life of our long-term contracts is 3.3 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 $130 million of incremental capitalized film costs classified in “Other Assets” for the period ended March 31, 2019.
v3.19.1
Financial Instruments
3 Months Ended
Mar. 31, 2019
Investments, Debt and Equity Securities [Abstract]  
Financial Instruments
Note 2 — FINANCIAL INSTRUMENTS
Cash, Cash Equivalents, Restricted Cash, and Marketable Securities
As of December 31, 2018 and March 31, 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 any cash, cash equivalents, restricted cash, or marketable securities categorized as Level 3 assets as of December 31, 2018 and March 31, 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
 
March 31, 2019
  
Total
Estimated
Fair Value
 
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Total
Estimated
Fair Value
Cash
$
10,406

 
$
8,635

 
$

 
$

 
$
8,635

Level 1 securities:
 
 
 
 
 
 
 
 
 
Money market funds
12,515

 
9,515

 

 

 
9,515

Equity securities (1)
170

 
 
 
 
 
 
 
263

Level 2 securities:
 
 
 
 
 
 
 
 
 
Foreign government and agency securities
815

 
1,382

 

 

 
1,382

U.S. government and agency securities
11,667

 
8,864

 
3

 
(13
)
 
8,854

Corporate debt securities
4,990

 
7,396

 
8

 
(6
)
 
7,398

Asset-backed securities
892

 
1,166

 
3

 
(2
)
 
1,167

Other fixed income securities
188

 
201

 

 
(1
)
 
200

Equity securities (1)
33

 
 
 
 
 
 
 

 
$
41,676

 
$
37,159

 
$
14

 
$
(22
)
 
$
37,414

Less: Restricted cash, cash equivalents, and marketable securities (2)
(426
)
 
 
 
 
 
 
 
(394
)
Total cash, cash equivalents, and marketable securities
$
41,250

 
 
 
 
 
 
 
$
37,020

___________________
(1)
The related unrealized gain (loss) recorded in “Other income (expense), net” was $68 million in Q1 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 March 31, 2019 (in millions):
 
Amortized
Cost
 
Estimated
Fair Value
Due within one year
$
23,482

 
$
23,478

Due after one year through five years
4,274

 
4,277

Due after five years through ten years
190

 
190

Due after ten years
578

 
571

Total
$
28,524

 
$
28,516


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 March 31, 2019, these warrants had a fair value of $440 million and $594 million, and are recorded within “Other assets” on our consolidated balance sheets. The related gain (loss) recorded in “Other income (expense), net” was $45 million and $89 million in Q1 2018 and Q1 2019. These assets are primarily classified as Level 2 assets.
As of December 31, 2018 and March 31, 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.
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
 
March 31, 2019
Cash and cash equivalents
$
31,750

 
$
23,115

Restricted cash included in accounts receivable, net and other
418

 
359

Restricted cash included in other assets
5

 
33

Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows
$
32,173

 
$
23,507

v3.19.1
Leases
3 Months Ended
Mar. 31, 2019
Leases [Abstract]  
Leases
LEASES
Gross assets recorded under finance leases, included in “Property and equipment, net,” were $36.1 billion and $46.5 billion as of December 31, 2018 and March 31, 2019. Accumulated amortization associated with finance leases was $19.8 billion and $23.0 billion as of December 31, 2018 and March 31, 2019.
Lease cost recognized in our consolidated statements of operations is summarized as follows (in millions):
 
Three Months Ended
March 31, 2019
 
 
Operating lease cost (1)
$
836

Finance lease cost:
 
Amortization of lease assets
2,307

Interest on lease liabilities
156

Finance lease cost
2,463

Variable lease cost
250

Total lease cost
$
3,549

__________________
(1)
Rental expense under operating lease agreements was $791 million for Q1 2018.
Other information about lease amounts recognized in our consolidated financial statements is summarized as follows:
 
March 31, 2019
 
 
Weighted-average remaining lease term – operating leases
11.4 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 March 31, 2019, our lease liabilities were as follows (in millions):
 
Operating Leases
 
Finance Leases
 
Total
 
 
 
 
 
 
Gross lease liabilities
$
26,731

 
$
25,004

 
$
51,735

Less: imputed interest
(5,850
)
 
(1,810
)
 
(7,660
)
Present value of lease liabilities
20,881

 
23,194

 
44,075

Less: current portion of lease liabilities
(2,490
)
 
(8,310
)
 
(10,800
)
Total long-term lease liabilities
$
18,391

 
$
14,884

 
$
33,275

v3.19.1
Commitments and Contingencies
3 Months Ended
Mar. 31, 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 March 31, 2019 (in millions): 
 
Nine Months Ended December 31,
 
Year Ended December 31,
 
 
 
 
 
2019
 
2020
 
2021
 
2022
 
2023
 
Thereafter
 
Total
Debt principal and interest
$
1,992

 
$
2,161

 
$
1,874

 
$
2,090

 
$
1,794

 
$
30,014

 
$
39,925

Operating leases
2,355

 
3,077

 
2,794

 
2,473

 
2,214

 
13,818

 
26,731

Finance lease liabilities, including interest
6,247

 
7,268

 
4,218

 
1,444

 
1,022

 
4,805

 
25,004

Financing obligations, including interest
15

 
23

 
23

 
24

 
24

 
313

 
422

Unconditional purchase obligations (1)
2,272

 
3,845

 
3,314

 
3,057

 
2,931

 
5,148

 
20,567

Other commitments (2) (3)
2,409

 
2,154

 
1,450

 
1,188

 
1,015

 
10,451

 
18,667

Total commitments
$
15,290

 
$
18,528

 
$
13,673

 
$
10,276

 
$
9,000

 
$
64,549

 
$
131,316

___________________
(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 $3.6 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 March 31, 2019, we have pledged or otherwise restricted $575 million and $609 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 as supplemented by the following:
In November 2018, Dynamic Data Technologies, LLC filed a complaint for patent infringement against Amazon.com, Inc., Amazon Web Services, Inc., and Amazon Digital Services, LLC in the United States District Court for the Eastern District of Texas. The complaint alleges, among other things, that products and services with H.265 functionality, including Amazon Elastic Transcoder, AWS Elemental Media Convert, AWS Elemental MediaLive, certain EC2 instances, Amazon CloudFront, Amazon Fire TV, and Amazon Fire tablets, infringe U.S. Patent Nos. 8,135,073, entitled “Enhancing Video Images Depending On Prior Image Enhancements”; 6,774,918, entitled “Video Overlay Processor With Reduced Memory And Bus Performance Requirements”; and 7,571,450, entitled “System For And Method Of Displaying Information.” The complaint also alleges that products and services with H.265 functionality, including AWS Elemental Media Convert, AWS Elemental MediaLive, certain EC2 instances, Amazon CloudFront, and Amazon Fire TV, infringe U.S. Patent Nos. 8,073,054, entitled “Unit For And Method Of Estimating A Current Motion Vector”; 6,996,177, entitled “Motion Estimation”; 8,311,112, entitled “System And Method For Video Compression Using Predictive Coding”; and 7,894,529, entitled “Method And Device For Determining Motion Vectors.” The complaint also alleges that products and services for encoding video data, including Amazon Elastic Transcoder and Amazon Video, infringe U.S. Patent No. 8,184,689, entitled “Method Video Encoding And Decoding Preserving Cache Localities,” and that products and services with VP9 encoding functionality, including Amazon Elastic Transcoder and Amazon Fire TV, infringe U.S. Patent No. 7,519,230, entitled “Background Motion Vector Detection.” In February 2019, Dynamic Data Technologies filed an amended complaint. The amended complaint adds allegations that products and services with H.265 image encoding functionality, including Amazon Elastic Transcoder, AWS Elemental Media Convert, AWS Elemental MediaLive, and Amazon Fire TV, infringe U.S. Patent No. 6,639,944, entitled “Sub-Pixel Accurate Motion Vector Estimation And Compensated Interpolation.” The amended complaint also adds allegations that products and services with H.265 functionality, including AWS Elemental Media Convert, AWS Elemental MediaLive, certain EC2 instances, Amazon CloudFront, and Amazon Fire TV, infringe U.S. Patent Nos. 6,782,054, entitled “Method And Apparatus For Motion Vector Estimation,” and 7,010,039, entitled “Motion Estimator For Reduced Halos In MC Up-Conversion.” The amended complaint also adds allegations that products and services with H.265 functionality, including Amazon Elastic Transcoder, AWS Elemental Media Convert, AWS Elemental MediaLive, certain EC2 instances, Amazon CloudFront, Amazon Fire TV, and Amazon Fire tablets, infringe U.S. Patent No. 8,189,105, entitled “Systems And Methods Of Motion And Edge Adaptive Processing Including Motion Compensation Features,” and that products and services with VP9 image processing functionality, including Amazon Elastic Transcoder and Amazon Fire TV, infringe U.S. Patent No. 7,058,227, entitled “Problem Area Location In An Image Signal.” The amended complaint seeks an unspecified amount of damages, enhanced damages, and attorneys’ fees. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in this matter.
In January 2019, Saint Lawrence Communications, LLC filed a complaint against Amazon.com, Inc. and Amazon.com LLC in the United States District Court for the Eastern District of Texas. The complaint alleges, among other things, that voice encoding functionality in Amazon devices infringes U.S. Patent Nos. 6,795,805, entitled “Periodicity Enhancement In Decoding Wideband Signals”; 6,807,524, entitled “Perceptual Weighting Device And Method For Efficient Coding Of Wideband Signals”; 7,151,802, entitled “High Frequency Content Recovering Method And Device For Over-Sampled Synthesized Wideband Signal”; 7,191,123, entitled “Gain-Smoothing In Wideband Speech And Audio Signal Decoder”; and 7,260,521, entitled “Method And Device For Adaptive Bandwidth Pitch Search In Coding Wideband Signals.” The complaint seeks an unspecified amount of damages, enhanced damages, attorneys’ fees, costs, and interest. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in this matter.
In March 2019, Data Scape, LLC filed a petition with the United States International Trade Commission requesting that the International Trade Commission commence an investigation into the sale of certain Amazon-branded devices, including Kindle e-readers, Fire tablets, FireTV devices, and the Echo Spot and Echo Show (“accused devices”). Data Scape’s petition alleges that, when used on the accused devices, Amazon Photo, Amazon Drive, Amazon Music, and book delivery infringe U.S. Patent Nos. 7,720,929; 7,617,537; and 8,386,581, each entitled “Communication System And Its Method And Communication Apparatus And Its Method.” Data Scape is seeking a general exclusion order preventing the importation of the accused devices into the United States. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in this matter.
In April 2019, Vocalife LLC filed a complaint against Amazon.com, Inc. and Amazon.com LLC in the United States District Court for the Eastern District of Texas. The complaint alleges, among other things, that Amazon Echo devices infringe U.S. Patent No. RE47,049, entitled “Microphone Array System.” The complaint seeks injunctive relief, an unspecified amount of damages, attorneys’ fees, costs, and interest. We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in this matter.
The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and could be material to our operating results and cash flows for a particular period. In addition, for 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.”
v3.19.1
Long-Term Debt
3 Months Ended
Mar. 31, 2019
Debt Disclosure [Abstract]  
Long-Term Debt
DEBT
As of March 31, 2019, we had $24.3 billion of unsecured senior notes outstanding (the “Notes”). As of December 31, 2018 and March 31, 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 $781 million as of December 31, 2018 and March 31, 2019. The face value of our total long-term debt obligations is as follows (in millions):
 
December 31, 2018
 
March 31, 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

 
539

Other long-term debt
121

 
242

Total debt
24,965

 
25,031

Less current portion of long-term debt
(1,371
)
 
(1,608
)
Face value of long-term debt
$
23,594

 
$
23,423


_____________________________
(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 $25.5 billion as of December 31, 2018 and March 31, 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 $539 million of borrowings outstanding under the Credit Facility as of December 31, 2018 and March 31, 2019, with weighted-average interest rates of 3.2% and 3.3% as of December 31, 2018 and March 31, 2019. As of December 31, 2018 and March 31, 2019, we have pledged $686 million and $630 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 March 31, 2019.
Other long-term debt, including the current portion, had a weighted-average interest rate of 6.0% and 5.5% as of December 31, 2018 and March 31, 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 March 31, 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 March 31, 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 March 31, 2019.
v3.19.1
Stockholders' Equity
3 Months Ended
Mar. 31, 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 in Q1 2018 or Q1 2019.
Stock Award Activity
Common shares outstanding plus shares underlying outstanding stock awards totaled 507 million as of December 31, 2018 and March 31, 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
March 31,
 
2018
 
2019
Cost of sales
$
15

 
$
24

Fulfillment
244

 
234

Marketing
161

 
209

Technology and content
631

 
675

General and administrative
132

 
132

Total stock-based compensation expense
$
1,183

 
$
1,274


The following table summarizes our restricted stock unit activity for the three months ended March 31, 2019 (in millions):
 
Number of Units
 
Weighted-Average
Grant-Date
Fair Value
Outstanding as of December 31, 2018
15.9

 
$
1,024

Units granted
0.6

 
1,677

Units vested
(1.2
)
 
627

Units forfeited
(0.4
)
 
1,023

Outstanding as of March 31, 2019
14.9

 
$
1,080


Scheduled vesting for outstanding restricted stock units as of March 31, 2019, is as follows (in millions):
 
Nine Months Ended December 31,
 
Year Ended December 31,
 
 
 
 
 
2019
 
2020
 
2021
 
2022
 
2023
 
Thereafter
 
Total
Scheduled vesting—restricted stock units
5.6

 
5.5

 
2.5

 
1.0

 
0.2

 
0.1

 
14.9


As of March 31, 2019, there was $6.1 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 March 31, 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
March 31,
 
2018
 
2019
Total beginning stockholders' equity
$
27,709

 
$
43,549

 
 
 
 
Beginning and ending common stock
5

 
5

 
 
 
 
Beginning and ending treasury stock
(1,837
)
 
(1,837
)
 
 
 
 
Beginning additional paid-in capital
21,389

 
26,791

Stock-based compensation and issuance of employee benefit plan stock
1,174

 
1,268

Ending additional paid-in capital
22,563

 
28,059

 
 
 
 
Beginning accumulated other comprehensive loss
(484
)
 
(1,035
)
Other comprehensive income (loss)
17

 
25

Ending accumulated other comprehensive loss
(467
)
 
(1,010
)
 
 
 
 
Beginning retained earnings
8,636

 
19,625

Cumulative effect of changes in accounting principles (1)
934

 
7

Net income
1,629

 
3,561

Ending retained earnings
11,199

 
23,193

 
 
 
 
Total ending stockholders’ equity
$
31,463

 
$
48,410

___________________
(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.
v3.19.1
Income Taxes
3 Months Ended
Mar. 31, 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 three months ended March 31, 2018 and March 31, 2019 were $287 million and $836 million, which included $368 million and $261 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 $513 million and $168 million in Q1 2018 and Q1 2019.
As of December 31, 2018 and March 31, 2019, tax contingencies were approximately $3.4 billion and $3.6 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.
v3.19.1
Segment Information
3 Months Ended
Mar. 31, 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
March 31,
 
2018
 
2019
North America
 
 
 
Net sales
$
30,725

 
$
35,812

Operating expenses
29,576

 
33,525

Operating income
$
1,149

 
$
2,287

 
 
 
 
International
 
 
 
Net sales
$
14,875

 
$
16,192

Operating expenses
15,497

 
16,282

Operating income (loss)
$
(622
)
 
$
(90
)
 
 
 
 
AWS
 
 
 
Net sales
$
5,442

 
$
7,696

Operating expenses
4,042

 
5,473

Operating income
$
1,400

 
$
2,223

 
 
 
 
Consolidated
 
 
 
Net sales
$
51,042

 
$
59,700

Operating expenses
49,115

 
55,280

Operating income
1,927

 
4,420

Total non-operating income (expense)
(11
)
 
(19
)
Provision for income taxes
(287
)
 
(836
)
Equity-method investment activity, net of tax

 
(4
)
Net income
$
1,629

 
$
3,561



Net sales by groups of similar products and services, which also have similar economic characteristics, is as follows (in millions):
  
Three Months Ended
March 31,
 
2018
 
2019
Net Sales:
 
Online stores (1)
$
26,939

 
$
29,498

Physical stores (2)
4,263

 
4,307

Third-party seller services (3)
9,265

 
11,141

Subscription services (4)
3,102

 
4,342

AWS
5,442

 
7,696

Other (5)
2,031

 
2,716

Consolidated
$
51,042

 
$
59,700

____________________________
(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.
(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.
v3.19.1
Accounting Policies (Policies)
3 Months Ended
Mar. 31, 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 balance sheets, operating results, and cash flows for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 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 March 31, 2019, customer receivables, net, were $9.4 billion and $9.8 billion, vendor receivables, net, were $3.2 billion and $2.5 billion, and seller receivables, net, were $710 million and $660 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 2.6 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 March 31, 2019 were $3.8 billion and $4.2 billion. Total video and music expense was $1.5 billion and $1.7 billion in Q1 2018 and Q1 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 $2.8 billion was recognized as revenue during the three months ended March 31, 2019. Included in “Other long-term liabilities” on our consolidated balance sheets was $1.4 billion of unearned revenue as of December 31, 2018 and March 31, 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 $21.6 billion as of March 31, 2019. The weighted average remaining life of our long-term contracts is 3.3 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 $130 million of incremental capitalized film costs classified in “Other Assets” for the period ended March 31, 2019.
v3.19.1
Accounting Policies (Tables)
3 Months Ended
Mar. 31, 2019
Accounting Policies [Abstract]  
Calculation of Diluted Shares
The following table shows the calculation of diluted shares (in millions):
  
Three Months Ended
March 31,
 
2018
 
2019
Shares used in computation of basic earnings per share
484

 
491

Total dilutive effect of outstanding stock awards
14

 
11

Shares used in computation of diluted earnings per share
498

 
502

v3.19.1
Financial Instruments (Tables)
3 Months Ended
Mar. 31, 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
 
March 31, 2019
  
Total
Estimated
Fair Value
 
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Total
Estimated
Fair Value
Cash
$
10,406

 
$
8,635

 
$

 
$

 
$
8,635

Level 1 securities:
 
 
 
 
 
 
 
 
 
Money market funds
12,515

 
9,515

 

 

 
9,515

Equity securities (1)
170

 
 
 
 
 
 
 
263

Level 2 securities:
 
 
 
 
 
 
 
 
 
Foreign government and agency securities
815

 
1,382

 

 

 
1,382

U.S. government and agency securities
11,667

 
8,864

 
3

 
(13
)
 
8,854

Corporate debt securities
4,990

 
7,396

 
8

 
(6
)
 
7,398

Asset-backed securities
892

 
1,166

 
3

 
(2
)
 
1,167

Other fixed income securities
188

 
201

 

 
(1
)
 
200

Equity securities (1)
33

 
 
 
 
 
 
 

 
$
41,676

 
$
37,159

 
$
14

 
$
(22
)
 
$
37,414

Less: Restricted cash, cash equivalents, and marketable securities (2)
(426
)
 
 
 
 
 
 
 
(394
)
Total cash, cash equivalents, and marketable securities
$
41,250

 
 
 
 
 
 
 
$
37,020

___________________
(1)
The related unrealized gain (loss) recorded in “Other income (expense), net” was $68 million in Q1 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 March 31, 2019 (in millions):
 
Amortized
Cost
 
Estimated
Fair Value
Due within one year
$
23,482

 
$
23,478

Due after one year through five years
4,274

 
4,277

Due after five years through ten years
190

 
190

Due after ten years
578

 
571

Total
$
28,524

 
$
28,516


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
 
March 31, 2019
Cash and cash equivalents
$
31,750

 
$
23,115

Restricted cash included in accounts receivable, net and other
418

 
359

Restricted cash included in other assets
5

 
33

Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows
$
32,173

 
$
23,507

v3.19.1
Leases (Tables)
3 Months Ended
Mar. 31, 2019
Leases [Abstract]  
Lease, Cost
Lease cost recognized in our consolidated statements of operations is summarized as follows (in millions):
 
Three Months Ended
March 31, 2019
 
 
Operating lease cost (1)
$
836

Finance lease cost:
 
Amortization of lease assets
2,307

Interest on lease liabilities
156

Finance lease cost
2,463

Variable lease cost
250

Total lease cost
$
3,549

__________________
(1)
Rental expense under operating lease agreements was $791 million for Q1 2018.
Other Operating and Finance Lease Information
Other information about lease amounts recognized in our consolidated financial statements is summarized as follows:
 
March 31, 2019
 
 
Weighted-average remaining lease term – operating leases
11.4 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 March 31, 2019, our lease liabilities were as follows (in millions):
 
Operating Leases
 
Finance Leases
 
Total
 
 
 
 
 
 
Gross lease liabilities
$
26,731

 
$
25,004

 
$
51,735

Less: imputed interest
(5,850
)
 
(1,810
)
 
(7,660
)
Present value of lease liabilities
20,881

 
23,194

 
44,075

Less: current portion of lease liabilities
(2,490
)
 
(8,310
)
 
(10,800
)
Total long-term lease liabilities
$
18,391

 
$
14,884

 
$
33,275

v3.19.1
Commitments and Contingencies (Tables)
3 Months Ended
Mar. 31, 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 March 31, 2019 (in millions): 
 
Nine Months Ended December 31,
 
Year Ended December 31,
 
 
 
 
 
2019
 
2020
 
2021
 
2022
 
2023
 
Thereafter
 
Total
Debt principal and interest
$
1,992

 
$
2,161

 
$
1,874

 
$
2,090

 
$
1,794

 
$
30,014

 
$
39,925

Operating leases
2,355

 
3,077

 
2,794

 
2,473

 
2,214

 
13,818

 
26,731

Finance lease liabilities, including interest
6,247

 
7,268

 
4,218

 
1,444

 
1,022

 
4,805

 
25,004

Financing obligations, including interest
15

 
23

 
23

 
24

 
24

 
313

 
422

Unconditional purchase obligations (1)
2,272

 
3,845

 
3,314

 
3,057

 
2,931

 
5,148

 
20,567

Other commitments (2) (3)
2,409

 
2,154

 
1,450

 
1,188

 
1,015

 
10,451

 
18,667

Total commitments
$
15,290

 
$
18,528

 
$
13,673

 
$
10,276

 
$
9,000

 
$
64,549

 
$
131,316

___________________
(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 $3.6 billion of accrued tax contingencies for which we cannot make a reasonably reliable estimate of the amount and period of payment, if any.
v3.19.1
Long-Term Debt (Tables)
3 Months Ended
Mar. 31, 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
 
March 31, 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

 
539

Other long-term debt
121

 
242

Total debt
24,965

 
25,031

Less current portion of long-term debt
(1,371
)
 
(1,608
)
Face value of long-term debt
$
23,594

 
$
23,423


_____________________________
(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%.
v3.19.1
Stockholders' Equity (Tables)
3 Months Ended
Mar. 31, 2019
Equity [Abstract]  
Stock-Based Compensation Expense
Stock-based compensation expense is as follows (in millions):
  
Three Months Ended
March 31,
 
2018
 
2019
Cost of sales
$
15

 
$
24

Fulfillment
244

 
234

Marketing
161

 
209

Technology and content
631

 
675

General and administrative
132

 
132

Total stock-based compensation expense
$
1,183

 
$
1,274


Nonvested Restricted Stock Units Activity
The following table summarizes our restricted stock unit activity for the three months ended March 31, 2019 (in millions):
 
Number of Units
 
Weighted-Average
Grant-Date
Fair Value
Outstanding as of December 31, 2018
15.9

 
$
1,024

Units granted
0.6

 
1,677

Units vested
(1.2
)
 
627

Units forfeited
(0.4
)
 
1,023

Outstanding as of March 31, 2019
14.9

 
$
1,080

Scheduled Vesting Restricted Stock Unit Activity
Scheduled vesting for outstanding restricted stock units as of March 31, 2019, is as follows (in millions):
 
Nine Months Ended December 31,
 
Year Ended December 31,
 
 
 
 
 
2019
 
2020
 
2021
 
2022
 
2023
 
Thereafter
 
Total
Scheduled vesting—restricted stock units
5.6

 
5.5

 
2.5

 
1.0

 
0.2

 
0.1

 
14.9

Changes in Stockholders Equity
The following table shows the changes in stockholders’ equity (in millions):
 
Three Months Ended
March 31,
 
2018
 
2019
Total beginning stockholders' equity
$
27,709

 
$
43,549

 
 
 
 
Beginning and ending common stock
5

 
5

 
 
 
 
Beginning and ending treasury stock
(1,837
)
 
(1,837
)
 
 
 
 
Beginning additional paid-in capital
21,389

 
26,791

Stock-based compensation and issuance of employee benefit plan stock
1,174

 
1,268

Ending additional paid-in capital
22,563

 
28,059

 
 
 
 
Beginning accumulated other comprehensive loss
(484
)
 
(1,035
)
Other comprehensive income (loss)
17

 
25

Ending accumulated other comprehensive loss
(467
)
 
(1,010
)
 
 
 
 
Beginning retained earnings
8,636

 
19,625

Cumulative effect of changes in accounting principles (1)
934

 
7

Net income
1,629

 
3,561

Ending retained earnings
11,199

 
23,193

 
 
 
 
Total ending stockholders’ equity
$
31,463

 
$
48,410

___________________
(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.
v3.19.1
Segment Information (Tables)
3 Months Ended
Mar. 31, 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
March 31,
 
2018
 
2019
North America
 
 
 
Net sales
$
30,725

 
$
35,812

Operating expenses
29,576

 
33,525

Operating income
$
1,149

 
$
2,287

 
 
 
 
International
 
 
 
Net sales
$
14,875

 
$
16,192

Operating expenses
15,497

 
16,282

Operating income (loss)
$
(622
)
 
$
(90
)
 
 
 
 
AWS
 
 
 
Net sales
$
5,442

 
$
7,696

Operating expenses
4,042

 
5,473

Operating income
$
1,400

 
$
2,223

 
 
 
 
Consolidated
 
 
 
Net sales
$
51,042

 
$
59,700

Operating expenses
49,115

 
55,280

Operating income
1,927

 
4,420

Total non-operating income (expense)
(11
)
 
(19
)
Provision for income taxes
(287
)
 
(836
)
Equity-method investment activity, net of tax

 
(4
)
Net income
$
1,629

 
$
3,561

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
March 31,
 
2018
 
2019
Net Sales:
 
Online stores (1)
$
26,939

 
$
29,498

Physical stores (2)
4,263

 
4,307

Third-party seller services (3)
9,265

 
11,141

Subscription services (4)
3,102

 
4,342

AWS
5,442

 
7,696

Other (5)
2,031

 
2,716

Consolidated
$
51,042

 
$
59,700

____________________________
(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.
(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.
v3.19.1
Accounting Policies - Calculation of Diluted Shares (Details) - shares
shares in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Accounting Policies [Abstract]    
Shares used in computation of basic earnings per share 491 484
Total dilutive effect of outstanding stock awards 11 14
Shares used in computation of diluted earnings per share 502 498
v3.19.1
Accounting Policies - Accounts Receivable, Net and Other (Details) - USD ($)
$ in Millions
Mar. 31, 2019
Dec. 31, 2018
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Accounts receivable, net and other $ 15,979 $ 16,677
Customer Receivables, net    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Accounts receivable, net and other 9,800 9,400
Vendor Receivables, net    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Accounts receivable, net and other 2,500 3,200
Seller Receivables, net    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Accounts receivable, net and other $ 660 $ 710
v3.19.1
Accounting Policies - Leases (Details)
3 Months Ended
Mar. 31, 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
v3.19.1
Accounting Policies - Video and Music Content (Details) - USD ($)
$ in Billions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Dec. 31, 2018
Accounting Policies [Abstract]      
Weighted Average Life, Capitalized Video Content 2 years 7 months    
Video and Music Content, Capitalized Costs $ 4.2   $ 3.8
Video and Music Content, Expense $ 1.7 $ 1.5  
v3.19.1
Accounting Policies - Unearned Revenue (Details) - USD ($)
$ in Billions
3 Months Ended
Mar. 31, 2019
Dec. 31, 2018
Accounting Policies [Abstract]    
Unearned revenue   $ 7.9
Unearned revenue, revenue recognized from beginning balance $ 2.8  
Unearned Revenue, Noncurrent 1.4 $ 1.4
Remaining performance obligation, contracts exceeding one year $ 21.6  
Remaining performance obligation, expected timing of satisfaction, weighted average remaining life 3 years 4 months  
v3.19.1
Accounting Policies - Accounting Pronouncements Recently Adopted (Details) - USD ($)
$ in Millions
Mar. 31, 2019
Jan. 01, 2019
Dec. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]      
Operating Leases, Asset $ 20,132   $ 0
Operating Lease, Liability 20,881    
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 $ 130    
v3.19.1
Financial Instruments - Fair Values on Recurring Basis (Details) - USD ($)
$ in Millions
3 Months Ended
Mar. 31, 2019
Dec. 31, 2018
Schedule of Investments [Line Items]    
Equity Securities, FV-NI, Unrealized Gain (Loss) $ 68  
Recurring    
Schedule of Investments [Line Items]    
Cash 8,635 $ 10,406
Total Estimated Fair Value    
Cash, cash equivalents and marketable securities 37,414 41,676
Less: Restricted cash, cash equivalents, and marketable securities (394) (426)
Total cash, cash equivalents, and marketable securities 37,020 41,250
Cost or Amortized Cost    
Cash, cash equivalents and marketable securities 37,159  
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax    
Debt Securities, Available for Sale, Unrealized Gain 14  
Debt Securities, Available for Sale, Unrealized Loss (22)  
Recurring | Level 1 securities    
Total Estimated Fair Value    
Equity Securities, FV-NI 263 170
Recurring | Level 1 securities | Money market funds    
Schedule of Investments [Line Items]    
Money market funds 9,515 12,515
Recurring | Level 2 securities    
Total Estimated Fair Value    
Equity Securities, FV-NI 0 33
Recurring | Level 2 securities | Foreign government and agency securities    
Total Estimated Fair Value    
Debt Securities, Available for Sale, Fair Value 1,382 815
Cost or Amortized Cost    
Debt Securities, Available for Sale, Cost 1,382  
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax    
Debt Securities, Available for Sale, Unrealized Gain 0  
Debt Securities, Available for Sale, Unrealized Loss 0  
Recurring | Level 2 securities | U.S. government and agency securities    
Total Estimated Fair Value    
Debt Securities, Available for Sale, Fair Value 8,854 11,667
Cost or Amortized Cost    
Debt Securities, Available for Sale, Cost 8,864  
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax    
Debt Securities, Available for Sale, Unrealized Gain 3  
Debt Securities, Available for Sale, Unrealized Loss (13)  
Recurring | Level 2 securities | Corporate debt securities    
Total Estimated Fair Value    
Debt Securities, Available for Sale, Fair Value 7,398 4,990
Cost or Amortized Cost    
Debt Securities, Available for Sale, Cost 7,396  
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax    
Debt Securities, Available for Sale, Unrealized Gain 8  
Debt Securities, Available for Sale, Unrealized Loss (6)  
Recurring | Level 2 securities | Asset-backed securities    
Total Estimated Fair Value    
Debt Securities, Available for Sale, Fair Value 1,167 892
Cost or Amortized Cost    
Debt Securities, Available for Sale, Cost 1,166  
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax    
Debt Securities, Available for Sale, Unrealized Gain 3  
Debt Securities, Available for Sale, Unrealized Loss (2)  
Recurring | Level 2 securities | Other fixed income securities    
Total Estimated Fair Value    
Debt Securities, Available for Sale, Fair Value 200 $ 188
Cost or Amortized Cost    
Debt Securities, Available for Sale, Cost 201  
Debt Securities, Available-for-sale, Accumulated Gross Unrealized Gain (Loss), before Tax    
Debt Securities, Available for Sale, Unrealized Gain 0  
Debt Securities, Available for Sale, Unrealized Loss $ (1)  
v3.19.1
Financial Instruments - Contractual Maturities (Details)
$ in Millions
Mar. 31, 2019
USD ($)
Amortized Cost  
Due within one year $ 23,482
Due after one year through five years 4,274
Due after five years through ten years 190
Due after ten years 578
Cash Equivalents and Marketable Fixed Income Securities, Cost 28,524
Estimated Fair Value  
Due within one year 23,478
Due after one year through five years 4,277
Due after five years through ten years 190
Due after ten years 571
Cash Equivalents and Marketable Fixed Income Securities, Fair Value $ 28,516
v3.19.1
Financial Instruments - Equity Warrant Assets and Non-Marketable Equity Securities (Details) - USD ($)
$ in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Dec. 31, 2018
Investments, Warrant Assets and Non-Marketable Equity Securities      
Equity Securities without Readily Determinable Fair Value, Amount $ 888   $ 282
Warrant      
Investments, Warrant Assets and Non-Marketable Equity Securities      
Gain (loss) on warrant assets 89 $ 45  
Warrant | Level 2 assets      
Investments, Warrant Assets and Non-Marketable Equity Securities      
Fair value of warrant assets $ 594   $ 440
v3.19.1
Financial Instruments - Reconciliation to Cash Flow (Details) - USD ($)
$ in Millions
Mar. 31, 2019
Dec. 31, 2018
Mar. 31, 2018
Dec. 31, 2017
Mar. 31, 2017
Investments, Debt and Equity Securities [Abstract]          
Cash and cash equivalents $ 23,115 $ 31,750      
Restricted cash included in accounts receivable, net and other 359 418      
Restricted cash included in other assets 33 5      
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows $ 23,507 $ 32,173 $ 17,616 $ 21,856 $ 16,301
v3.19.1
Leases - Additional Information (Details) - USD ($)
$ in Billions
Mar. 31, 2019
Dec. 31, 2018
Leases [Abstract]    
Finance Lease, Right-of-Use Asset $ 46.5 $ 36.1
Finance Lease, Right-of-Use-Asset, Accumulated Amortization $ 23.0 $ 19.8
v3.19.1
Leases - Lease Cost (Details) - USD ($)
$ in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Leases [Abstract]    
Operating lease cost $ 836  
Finance lease amortization of lease assets 2,307  
Finance lease interest on lease liabilities 156  
Finance lease cost 2,463  
Variable lease cost 250  
Total lease cost $ 3,549  
Rental expense under operating lease agreements   $ 791
v3.19.1
Leases - Other Operating and Finance Lease Information (Details)
Mar. 31, 2019
Leases [Abstract]  
Weighted-average remaining lease term – operating leases 11 years 5 months
Weighted-average remaining lease term – finance leases 5 years 8 months
Weighted-average discount rate – operating leases 3.20%
Weighted-average discount rate – finance leases 2.90%
v3.19.1
Leases - Operating and Finance Lease Liability Reconciliation (Details) - USD ($)
$ in Millions
Mar. 31, 2019
Dec. 31, 2018
Leases [Abstract]    
Gross lease liabilities - operating leases $ 26,731  
Gross lease liabilities - finance leases 25,004  
Gross lease liabilities 51,735  
Imputed interest - operating leases (5,850)  
Imputed interest - finance leases (1,810)  
Imputed interest (7,660)  
Present value of operating leases 20,881  
Present value of finance leases 23,194  
Present value of lease liabilities 44,075  
Current portion of operating lease liabilities (2,490)  
Current portion of finance lease liabilities (8,310)  
Current portion of lease liabilities (10,800)  
Total long-term operating lease liabilities 18,391  
Total long-term finance lease liabilities 14,884  
Total long-term lease liabilities $ 33,275 $ 9,650
v3.19.1
Commitments and Contingencies - Principal Contractual Commitments Excluding Open Orders (Details) - USD ($)
$ in Millions
Mar. 31, 2019
Dec. 31, 2018
Debt principal and interest    
Nine Months Ended December 31, 2019 $ 1,992  
Year Ended December 31, 2020 2,161  
Year Ended December 31, 2021 1,874  
Year Ended December 31, 2022 2,090  
Year Ended December 31, 2023 1,794  
Thereafter 30,014  
Total 39,925  
Operating leases    
Nine Months Ended December 31, 2019 2,355  
Year Ended December 31, 2020 3,077  
Year Ended December 31, 2021 2,794  
Year Ended December 31, 2022 2,473  
Year Ended December 31, 2023 2,214  
Thereafter 13,818  
Gross lease liabilities - operating leases 26,731  
Finance lease liabilities, including interest    
Nine Months Ended December 31, 2019 6,247  
Year Ended December 31, 2020 7,268  
Year Ended December 31, 2021 4,218  
Year Ended December 31, 2022 1,444  
Year Ended December 31, 2023 1,022  
Thereafter 4,805  
Gross lease liabilities - finance leases 25,004  
Financing obligations, including interest    
Nine Months Ended December 31, 2019 15  
Year Ended December 31, 2020 23  
Year Ended December 31, 2021 23  
Year Ended December 31, 2022 24  
Year Ended December 31, 2023 24  
Thereafter 313  
Total 422  
Unconditional purchase obligations    
Nine Months Ended December 31, 2019 2,272  
Year Ended December 31, 2020 3,845  
Year Ended December 31, 2021 3,314  
Year Ended December 31, 2022 3,057  
Year Ended December 31, 2023 2,931  
Thereafter 5,148  
Total 20,567  
Other commitments    
Nine Months Ended December 31, 2019 2,409  
Year Ended December 31, 2020 2,154  
Year Ended December 31, 2021 1,450  
Year Ended December 31, 2022 1,188  
Year Ended December 31, 2023 1,015  
Thereafter 10,451  
Total 18,667  
Accrued tax contingencies 3,600 $ 3,400
Total commitments    
Nine Months Ended December 31, 2019 15,290  
Year Ended December 31, 2020 18,528  
Year Ended December 31, 2021 13,673  
Year Ended December 31, 2022 10,276  
Year Ended December 31, 2023 9,000  
Thereafter 64,549  
Total $ 131,316  
v3.19.1
Commitments and Contingencies - Pledged Assets (Details) - USD ($)
$ in Millions
Mar. 31, 2019
Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]    
Pledged assets $ 609 $ 575
v3.19.1
Debt - Additional Information (Details)
1 Months Ended
Apr. 30, 2018
USD ($)
extension
Oct. 31, 2016
USD ($)
Mar. 31, 2019
USD ($)
Dec. 31, 2018
USD ($)
Debt Instrument [Line Items]        
Borrowings outstanding     $ 25,031,000,000 $ 24,965,000,000
Face value of long-term debt     23,423,000,000 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     25,500,000,000 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     539,000,000 594,000,000
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     $ 539,000,000 $ 594,000,000
Weighted average interest rate     3.30% 3.20%
Collateral amount     $ 630,000,000 $ 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     781,000,000 715,000,000
Other Long-term Debt        
Debt Instrument [Line Items]        
Borrowings outstanding     $ 242,000,000 $ 121,000,000
Weighted average interest rate     5.50% 6.00%
v3.19.1
Debt - Long-Term Debt Obligations (Details) - USD ($)
Mar. 31, 2019
Dec. 31, 2018
Apr. 30, 2018
Oct. 31, 2016
Debt Instrument [Line Items]        
Total debt $ 25,031,000,000 $ 24,965,000,000    
Less current portion of long-term debt (1,608,000,000) (1,371,000,000)    
Face value of long-term debt 23,423,000,000 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 $ 539,000,000 594,000,000    
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 $ 242,000,000 $ 121,000,000    
v3.19.1
Stockholders' Equity - Additional Information (Details) - USD ($)
shares in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Dec. 31, 2018
Feb. 29, 2016
Class of Stock [Line Items]        
Common shares outstanding plus underlying outstanding stock awards 507   507  
Net unrecognized compensation cost related to unvested stock-based compensation arrangements $ 6,100,000,000      
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      
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    
v3.19.1
Stockholders' Equity - Stock-based Compensation Expense (Details) - USD ($)
$ in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]    
Total stock-based compensation expense $ 1,274 $ 1,183
Cost of sales    
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]    
Total stock-based compensation expense 24 15
Fulfillment    
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]    
Total stock-based compensation expense 234 244
Marketing    
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]    
Total stock-based compensation expense 209 161
Technology and content    
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]    
Total stock-based compensation expense 675 631
General and administrative    
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]    
Total stock-based compensation expense $ 132 $ 132
v3.19.1
Stockholders' Equity - Restricted Stock Unit Activity (Details) - Restricted Stock Units
shares in Millions
3 Months Ended
Mar. 31, 2019
$ / shares
shares
Number of Units  
Beginning balance (in shares) | shares 15.9
Units granted (in shares) | shares 0.6
Units vested (in shares) | shares (1.2)
Units forfeited (in shares) | shares (0.4)
Ending balance (in shares) | shares 14.9
Weighted-Average Grant-Date Fair Value  
Outstanding as of December 31, 2018 | $ / shares $ 1,024
Units granted | $ / shares 1,677
Units vested | $ / shares 627
Units forfeited | $ / shares 1,023
Outstanding as of March 31, 2019 | $ / shares $ 1,080
v3.19.1
Stockholders' Equity - Scheduled Vesting for Outstanding Restricted Stock Units (Details) - Restricted Stock Units - shares
shares in Millions
Mar. 31, 2019
Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Nine Months Ended December 31, 2019 5.6  
Year Ended December 31, 2020 5.5  
Year Ended December 31, 2021 2.5  
Year Ended December 31, 2022 1.0  
Year Ended December 31, 2023 0.2  
Thereafter 0.1  
Total 14.9 15.9
v3.19.1
Stockholders' Equity - Changes in Stockholders Equity (Details) - USD ($)
$ in Millions
3 Months Ended 12 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Mar. 31, 2019
Mar. 31, 2018
Jan. 01, 2019
Dec. 31, 2018
Jan. 01, 2018
Dec. 31, 2017
Stockholders' equity $ 48,410 $ 31,463 $ 48,410 $ 31,463   $ 43,549   $ 27,709
Other comprehensive income (loss) 25 17            
Net Income 3,561 1,629 12,005 3,938        
Common stock                
Stockholders' equity 5 5 5 5   5   5
Treasury stock                
Stockholders' equity (1,837) (1,837) (1,837) (1,837)   (1,837)   (1,837)
Additional paid-in capital                
Stockholders' equity 28,059 22,563 28,059 22,563   26,791   21,389
Stock-based compensation and issuance of employee benefit plan stock 1,268 1,174            
Accumulated other comprehensive income (loss)                
Stockholders' equity (1,010) (467) (1,010) (467)   (1,035)   (484)
Other comprehensive income (loss) 25 17            
Retained earnings                
Stockholders' equity 23,193 11,199 $ 23,193 $ 11,199   $ 19,625   $ 8,636
Cumulative effect of changes in accounting principles         $ 7   $ 934  
Net Income $ 3,561 $ 1,629            
v3.19.1
Income Taxes - Income Taxes (Details)
€ in Millions, $ in Millions
3 Months Ended 12 Months Ended
Oct. 04, 2017
EUR (€)
Mar. 31, 2019
USD ($)
Mar. 31, 2018
USD ($)
Mar. 31, 2019
USD ($)
Mar. 31, 2018
USD ($)
Dec. 31, 2018
USD ($)
Income Tax Disclosure [Abstract]            
Provision for income taxes   $ 836 $ 287      
Discrete tax benefits   261 368      
Cash taxes paid, net of refunds   168 $ 513 $ 840 $ 1,224  
Tax contingencies   3,600   $ 3,600   $ 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          
v3.19.1
Segment Information - Reportable Segments and Reconciliation to Consolidated Net Income (Details)
$ in Millions
3 Months Ended 12 Months Ended
Mar. 31, 2019
USD ($)
segment
Mar. 31, 2018
USD ($)
Mar. 31, 2019
USD ($)
Mar. 31, 2018
USD ($)
Segment Reporting [Abstract]        
Number of operating segments | segment 3      
Segment Reporting Disclosure [Line Items]        
Net sales $ 59,700 $ 51,042    
Operating expenses 55,280 49,115    
Operating income (loss) 4,420 1,927    
Total non-operating income (expense) (19) (11)    
Provision for income taxes (836) (287)    
Equity-method investment activity, net of tax (4) 0    
Net income 3,561 1,629 $ 12,005 $ 3,938
North America        
Segment Reporting Disclosure [Line Items]        
Net sales 35,812 30,725    
Operating expenses 33,525 29,576    
Operating income (loss) 2,287 1,149    
International        
Segment Reporting Disclosure [Line Items]        
Net sales 16,192 14,875    
Operating expenses 16,282 15,497    
Operating income (loss) (90) (622)    
AWS        
Segment Reporting Disclosure [Line Items]        
Net sales 7,696 5,442    
Operating expenses 5,473 4,042    
Operating income (loss) $ 2,223 $ 1,400    
v3.19.1
Segment Information - Disaggregation of Revenue (Details) - USD ($)
$ in Millions
3 Months Ended
Mar. 31, 2019
Mar. 31, 2018
Disaggregation of Revenue [Line Items]    
Total net sales $ 59,700 $ 51,042
Online stores    
Disaggregation of Revenue [Line Items]    
Total net sales 29,498 26,939
Physical stores    
Disaggregation of Revenue [Line Items]    
Total net sales 4,307 4,263
Third-party seller services    
Disaggregation of Revenue [Line Items]    
Total net sales 11,141 9,265
Subscription services    
Disaggregation of Revenue [Line Items]    
Total net sales 4,342 3,102
AWS    
Disaggregation of Revenue [Line Items]    
Total net sales 7,696 5,442
Other    
Disaggregation of Revenue [Line Items]    
Total net sales $ 2,716 $ 2,031