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54
2014 Acquisition Activity
On September 25, 2014, we acquired Twitch Interactive, Inc. (“Twitch”) for approximately $842 million in cash, as
adjusted for the assumption of options and other items. During 2014, we acquired certain other companies for an aggregate
purchase price of $20 million. We acquired Twitch because of its user community and the live streaming experience it
provides. The primary reasons for our other 2014 acquisitions were to acquire technologies and know-how to enable Amazon to
serve customers more effectively.
Acquisition-related costs were expensed as incurred and not significant. The aggregate purchase price of these
acquisitions was allocated as follows (in millions):
Purchase Price
Cash paid, net of cash acquired $ 813
Stock options assumed 44
Indemnification holdback 5
$ 862
Allocation
Goodwill $ 707
Intangible assets (1):
Marketing-related 23
Contract-based 1
Technology-based 33
Customer-related 173
230
Property and equipment 16
Deferred tax assets 64
Other assets acquired 34
Deferred tax liabilities (88)
Other liabilities assumed (101)
$ 862
___________________
(1) Acquired intangible assets have estimated useful lives of between one and five years, with a weighted-average
amortization period of five years.
The fair value of assumed stock options of $39 million, estimated using the Black-Scholes model, will be expensed over
the remaining service period. We determined the estimated fair value of identifiable intangible assets acquired primarily by
using the income approach. These assets are included within “Other assets” on our consolidated balance sheets and are being
amortized to operating expenses on a straight-line or accelerated basis over their estimated useful lives.
Pro forma results of operations have not been presented because the effects of these acquisitions, individually and in the
aggregate, were not material to our consolidated results of operations.
2013 Acquisition Activity
In 2013, we acquired several companies in cash transactions for an aggregate purchase price of $195 million, resulting in
goodwill of $103 million and acquired intangible assets of $83 million. The primary reasons for these acquisitions were to
expand our customer base and sales channels and to obtain certain technologies to be used in product development. We
determined the estimated fair value of identifiable intangible assets acquired primarily by using the income and cost
approaches. These assets are included within “Other assets” on our consolidated balance sheets and are being amortized to
operating expenses on a straight-line or accelerated basis over their estimated useful lives. Acquisition-related costs were
expensed as incurred and were not significant.
Pro forma results of operations have not been presented because the effects of these acquisitions, individually and in the
aggregate, were not material to our consolidated results of operations.