Amazon.com 2006 Annual Report Download - page 55

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AMAZON.COM, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
Year Ended December 31,
2006 2005 2004
Net sales ............................................................ $10,711 $8,490 $6,921
Cost of sales ......................................................... 8,255 6,451 5,319
Gross profit .......................................................... 2,456 2,039 1,602
Operating expenses (1):
Fulfillment ...................................................... 937 745 601
Marketing ....................................................... 263 198 162
Technology and content ............................................ 662 451 283
General and administrative ......................................... 195 166 124
Other operating expense (income) .................................... 10 47 (8)
Total operating expenses ....................................... 2,067 1,607 1,162
Income from operations ................................................ 389 432 440
Interest income ....................................................... 59 44 28
Interest expense ...................................................... (78) (92) (107)
Other income (expense), net ............................................. (4) 2 (5)
Remeasurements and other .............................................. 11 42 (1)
Total non-operating expense ........................................ (12) (4) (85)
Income before income taxes ............................................. 377 428 355
Provision (benefit) for income taxes ...................................... 187 95 (233)
Income before cumulative effect of change in accounting principle .............. 190 333 588
Cumulative effect of change in accounting principle ......................... — 26 —
Net income .......................................................... $ 190 $ 359 $ 588
Basic earnings per share:
Prior to cumulative effect of change in accounting principle ............... $ 0.46 $ 0.81 $ 1.45
Cumulative effect of change in accounting principle ..................... — 0.06 —
$ 0.46 $ 0.87 $ 1.45
Diluted earnings per share:
Prior to cumulative effect of change in accounting principle ............... $ 0.45 $ 0.78 $ 1.39
Cumulative effect of change in accounting principle ..................... — 0.06 —
$ 0.45 $ 0.84 $ 1.39
Weighted average shares used in computation of earnings per share:
Basic ........................................................... 416 412 406
Diluted ......................................................... 424 426 425
(1) Includes stock-based compensation as follows:
Fulfillment ...................................................... $ 24 $ 16 $ 10
Marketing ....................................................... 4 6 4
Technology and content ............................................ 54 45 32
General and administrative ......................................... 19 20 12
See accompanying notes to consolidated financial statements.
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