Amazon.com 2003 Annual Report Download - page 77

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AMAZON.COM, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Note 9—EARNINGS (LOSS) PER SHARE
The following represents the calculations for net earnings (loss) per share (in thousands, except per share
data):
For the Years Ended December 31,
2003 2002 2001
Income(loss)beforechangeinaccountingprinciple ................... $ 35,282 $(149,933) $(556,754)
Cumulative effect of change in accounting principle ................... — 801 (10,523)
Netincome(loss)........................................... $ 35,282 $(149,132) $(567,277)
Weighted average shares outstanding ............................... 396,389 379,494 365,180
Weighted average shares of restricted stock .......................... (910) (1,131) (969)
Shares used in computation of basic earnings (loss) per share ........ 395,479 378,363 364,211
Total dilutive effect of outstanding stock awards (1) ............... 23,873 — —
Shares used in computation of diluted earnings (loss) per share ...... 419,352 378,363 364,211
Basic earnings (loss) per share:
Prior to cumulative effect of change in accounting principle ......... $ 0.09 $ (0.40) $ (1.53)
Cumulative effect of change in accounting principle ............... — 0.01 (0.03)
Total earnings (loss) per share ............................. $ 0.09 $ (0.39) $ (1.56)
Diluted earnings (loss) per share:
Prior to cumulative effect of change in accounting principle ......... $ 0.08 $ (0.40) $ (1.53)
Cumulative effect of change in accounting principle ............... — 0.01 (0.03)
Total earnings (loss) per share ............................. $ 0.08 $ (0.39) $ (1.56)
(1) The effect of outstanding stock awards, including restricted stock, is antidilutive for periods that we have a
net loss and, accordingly, is excluded from the calculation of diluted loss per share in those periods. The
dilutive effect of stock awards and restricted stock is included in the calculation of weighted average shares,
using the treasury stock method, for periods that we have net income.
Note 10—RESTRUCTURING-RELATED AND OTHER
In the first quarter of 2001, we announced and began implementation of our operational restructuring plan to
reduce operating costs, streamline our organizational structure, consolidate certain of our fulfillment and
customer service operations and migrate a large portion of our technology infrastructure to a new operating
platform. This initiative involved the reduction of employee staff by 1,327 positions throughout the Company in
managerial, professional, clerical, technical and fulfillment roles; consolidation of our Seattle, Washington
corporate office locations; closure of our McDonough, Georgia and Seattle, Washington fulfillment centers;
closure of our customer service centers in Seattle, Washington and The Hague, Netherlands; and migration of a
large portion of our technology infrastructure to a new operating platform, which entails ongoing lease
obligations for technology infrastructure no longer being utilized. Actual employee termination benefits paid
were $12 million. The restructuring is complete; however we may adjust our restructuring-related estimates in
the future, if necessary.
Restructuring-related expenses of $0.1 million were incurred during the year ended December 31, 2003
relating to updated estimates of sub-lease income due to weakness in real estate markets. Restructuring-related
and other expenses were $42 million and $182 million for 2002 and 2001.
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