Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Thu Jan 29 2015 16:32:58

Amazon Releases Fourth Quarter 2014 Earnings

By: Ina Steiner

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Amazon's conference call with analysts is at 5:00 pm EST today, here is the company's press release announcing fourth quarter 2014 earnings, you can view the full release with tables on Amazon's investor relations website.

Amazon.com Announces Fourth Quarter Sales up 15% to $29.33 Billion

Amazon.com, Inc. (NASDAQ:AMZN) today announced financial results for its fourth quarter ended December 31, 2014.

Operating cash flow increased 25% to $6.84 billion for the trailing twelve months, compared with $5.47 billion for the trailing twelve months ended December 31, 2013. Free cash flow decreased to $1.95 billion for the trailing twelve months, compared with $2.03 billion for the trailing twelve months ended December 31, 2013.

Common shares outstanding plus shares underlying stock-based awards totaled 483 million on December 31, 2014, compared with 476 million one year ago.

Fourth Quarter 2014
Net sales increased 15% to $29.33 billion in the fourth quarter, compared with $25.59 billion in fourth quarter 2013. Excluding the $895 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 18% compared to fourth quarter 2013.

Operating income was $591 million in the fourth quarter, compared with operating income of $510 million in fourth quarter 2013.

Net income was $214 million in the fourth quarter, or $0.45 per diluted share, compared with net income of $239 million, or $0.51 per diluted share, in fourth quarter 2013.

Full Year 2014
Net sales increased 20% to $88.99 billion, compared with $74.45 billion in 2013. Excluding the $636 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the year, net sales increased 20% compared with 2013.

Operating income was $178 million, compared with operating income of $745 million in 2013.

Net loss was $241 million, or $0.52 per diluted share, compared with net income of $274 million, or $0.59 per diluted share, in 2013.

"When we raised the price of Prime membership last year, we were confident that customers would continue to find it the best bargain in the history of shopping. The data is in and customers agree - on a base of tens of millions, worldwide paid membership grew 53% last year - 50% in the U.S. and even a bit faster outside the U.S.," said Jeff Bezos, founder and CEO of Amazon.com. "Prime is a one-of-a-kind, all-you-can-eat, physical-digital hybrid - in 2014 alone we paid billions of dollars for Prime shipping and invested $1.3 billion in Prime Instant Video. We'll continue to work hard for our Prime members."

Selected Highlights (See full press release for all highlights.)

    The number of Amazon sellers using Fulfillment by Amazon (FBA) grew by more than 65% year-over-year in 2014. In the fourth quarter, FBA units represented more than 40% of total third-party units.

    Amazon unveiled its 8th generation fulfillment center which utilizes robotics, vision systems, and almost 20 years worth of software and mechanical innovations to fulfill customer orders. During the holiday season, the fulfillment network included more than 15,000 robots in 10 fulfillment centers across the U.S.

    Amazon.co.uk announced that Sunday deliveries have grown by more than 4x in the last year as more customers across the U.K. discover the benefits of receiving orders seven days a week. The increase in Sunday deliveries has been made possible in large part due to the introduction of Amazon Logistics, a technology and logistics platform that empowers independent local, regional, and national delivery companies across the U.K. to deliver Amazon parcels to customers seven days a week.

    In 2014, the second year of its operation, Amazon.in emerged as India's largest online store. It launched 24 new departments, increasing selection to over 19 million products, and grew its seller base exponentially to more than 16,000 sellers.

    Amazon launched Amazon Global Store on the China site, www.amazon.cn. The store provides approximately 200,000 products selected from the Amazon U.S. website based on the most popular Chinese customer demands. Chinese customers are now able to enjoy the same quality product at the same price as U.S. customers, while having a Chinese shopping experience, local customer service, and direct shipment to their homes.

Financial Guidance
The following forward-looking statements reflect Amazon.com's expectations as of January 29, 2015, and are subject to substantial uncertainty. Our results are inherently unpredictable and may be materially affected by many factors, such as fluctuations in foreign exchange rates, changes in global economic conditions and consumer spending, world events, the rate of growth of the Internet and online commerce, and the various factors detailed below.

First Quarter 2015 Guidance
    Net sales are expected to be between $20.9 billion and $22.9 billion, or to grow between 6% and 16% compared with first quarter 2014.
    Operating income (loss) is expected to be between $(450) million and $50 million, compared to $146 million in first quarter 2014.
    This guidance includes approximately $450 million for stock-based compensation and amortization of intangible assets, and it assumes, among other things, that no additional business acquisitions, investments, restructurings, or legal settlements are concluded and that there are no further revisions to stock-based compensation estimates.

A conference call will be webcast live today at 2 p.m. PT/5 p.m. ET, and will be available for at least three months at www.amazon.com/ir. This call will contain forward-looking statements and other material information regarding the Company's financial and operating results.

Update 1/30/15:
See Friday's Newsflash story on Amazon Q4 earnings.




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Readers Comments

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This user has validated their user name. by: iheartjacksparrow

Thu Jan 29 17:19:55 2015

Amazon up 15%, eBay up 2%. I guess JD will need to take a thinking day to contemplate what when wrong.  

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This user has validated their user name. by: Ric

Thu Jan 29 18:57:45 2015

John Donahoe's destructive innovations took a decade to decimate what was once one of the most popular web sites on the net.

Perhaps, now that it is clear that the priority of having an MBA run a company should take a backseat to having a CEO who actually understands the business they will be running.

John Donahoe might hold an MBA but, he has no such experience, and has proven to be the worst possible choice to lead eBay.

Meanwhile, over at Amazon, Jeff Bezos with no MBA continues to show double digit growth.  Obviously, Mr Bezos has a better grasp of what it takes to build and grow a marketplace while at the same time not over thinking the path to success.

Donahoe's decade long failure to copy Amazon's success must keep Jeff Bezos up at night laughing at the comedy of errors that has successfully allowed his primary competitor to destroy itself from within.

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by: Massachusets Howler This user has validated their user name.

Thu Jan 29 19:02:46 2015

Wall street was doubting .17 cents- and BEZOS DELIVERED .45.

18% growth overall compared to last year, and ebay at what is it- 4.5%??????????

Watch for a big fall on ebay now, the pump is primed.

I think we will go sub-50 FOR GOOD in the next week.

They better "spin off" Paypal TOMORROW morning-LOL!!

Mass Howler
PS: I sense a big fee increase out of ebay VERY (VERY) SOON.
-all ebay execs are CASHING OUT LIKE CRAZY- need a story on this.

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This user has validated their user name. by: Anonymous Annie

Thu Jan 29 19:15:24 2015

I suspect that JD will be more than a mere footnote in the history of eBay. In fact, I believe that future economics and business textbooks will have entire chapters dedicated to examining the colossal failure of eBay and the Donohoe policies and ''vision'' that led to eBay's decline (and eventual demise?)

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This user has validated their user name. by: Shop and Ship

Thu Jan 29 19:50:10 2015

What does it mean, Mr. Natural? http://4.bp.blogspot.com/-g5rbNuDsxZQ/UcSUQrOCjZI/AAAAAAAABwU/aKn9JPaW
myE/s1600/Mr.+Natural+insane.jpg
 

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by: gizmo This user has validated their user name.

Thu Jan 29 20:26:45 2015

Amazon is more efficient & realistic. Signs of the times , people are sick of deadbays cr--p.

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by: Massachusets Howler This user has validated their user name.

Thu Jan 29 21:20:18 2015

Amazon UP $38 in after-hours, after gaining over $7 today- it is up $45 per share SINCE THIS am.

Ebay is DEAD.
Paypal is LOSING "VALUE" by the day.

The KNIFE has gone in, now let's see what happens to the WOUND.

MH

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by: pace306 This user has validated their user name.

Thu Jan 29 22:55:31 2015

@ RIC & @ SPARROW - EXACTLY correct =) !

JDs golden parachute should be lead lined for all the losses hes caused the company.

Had the board hired my cat instead of JD, she would have done better then argue with herself as to whether or not to spin off paypal and would have gotten a better result then %2.

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This user has validated their user name. by: Marie

Fri Jan 30 03:33:33 2015

Net loss was $241 million.

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by: Massachusets Howler This user has validated their user name.

Fri Jan 30 05:27:38 2015

Amz. made 210 Million in the 1/4.
They have a 2% operating margin.
Their overall market cap went up 21 billion in THE LAST 24 HOURS.
Ebay has BEEN smoked, by a guy WITHOUT an MBA.
Bezos builds, Donahoe lies.
Our MBA Emperor has been DISROBED.
MH
Ebay is on the BAIN train. Read the Sept. 2012 Rolling Stone article (Greed & Debt) and it will ALL make sense to you.

Perminate Link for Amazon Releases Fourth Quarter 2014 Earnings   Amazon Releases Fourth Quarter 2014 Earnings

This user has validated their user name. by: iheartjacksparrow

Fri Jan 30 09:04:46 2015

@Marie - That was for all of 2014. Don't forget, eBay took a net loss in the First Quarter of 2014 (not the entire year) of $2.3 BILLION.

Perminate Link for Amazon Releases Fourth Quarter 2014 Earnings   Amazon Releases Fourth Quarter 2014 Earnings

by: ebay refugee camp This user has validated their user name.

Fri Jan 30 10:05:10 2015

It is very clear that ebay has failed in its management and policies.
Since ebay's board is stacked with wall street tycoons nothing will happen.
The only thing that can save ebay is a complete wipeout of the present board and management and replaced with those who want honest profits from sales not profits from shady stock market deals

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by: maxmad This user has validated their user name.

Fri Jan 30 15:57:41 2015

Not a surprise at all , that Amazon is kicking eBay's ass,


In fact almost every other venue we sell in now is NOW out selling ebay.

When you compare Amazon vs. Ebay on Google trends, the two graph lines look exactly like a big X one is going up, and one is going down,

We learned a lot from the evil JD ebay empire, and even thou Amazon is the clear winner, we will still continue to spread our product thru multiple venues, and not just Amazon alone.


JD will go down in history as the man who completely destroyed a multi billion dollar company, the guys at Amazon must be laughing at JD, he must have been a big part of their profit this year.    
 

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by: Volvo351 This user has validated their user name.

Fri Jan 30 17:46:10 2015

The River's going Gangbusters while the ecommerce joke mis-managed by The      Hoe is handing The Street nothing but   excuses, and its paying customers [ie sellers] grief. And the worthless BoD  shelled out $23MM to "retain" this clown?

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by: Mark4 This user has validated their user name.

Sat Jan 31 15:32:16 2015

This is all good news to us, we had 3200+ items for sale on ebay, we just last week, ended them all and moved them all to Amazon. The great folks at Amazon helped us move them in one swoop. Amazon is laughing all the way to the bank at ebay as it continues to sink fast.

Perminate Link for Amazon Releases Fourth Quarter 2014 Earnings   Amazon Releases Fourth Quarter 2014 Earnings

by: Massachusets Howler This user has validated their user name.

Sat Jan 31 22:32:23 2015

Just read an article about a company in SF that sells used stuff and Andreesson-Horowitz last year provided 18.5 of their 23 mill in total funding.

Twice- Used CLOTHING from sellers, twice buys it for avg. $4, photos and sells/ships/all automated 280 employees San Francisco.

This while Andreesson sat on ebays board- dirty. This co. Twice was formed specifically to exploit ebays weakness- that IS its model.
mh

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by: Patricia This user has validated their user name.

Sun Feb 1 14:38:40 2015

I think I've proven to myself that most of Ebay's traffic are people who buy and sell on Ebay.  Since a lot of small sellers left, buyer traffic has petered out as well.  Looking at my own experience, I bought most of my holiday things at Amazon.  The service was great, the shipments never skipped a beat and I got exactly what I wanted without having to join the frenzied mobs in the stores and the store parking lots.  Ebay, has so lost its way.  It should have compounded on what it was when Meg left.  It should have been less ham-fisted and more understanding of both buyer AND seller experiences.  Having lost sight of that, it lost its way and succumbed to big stores coming in and stealing customers away.  The fact that the board did not see this 4 or 5 or even 6 years ago is as much their fault as managements.  At this point did Donahue's 3 year turn around ever come to pass?  

Yes, Bezo's should send Donohue a case of champagne (the cheapest brand because JD really wouldn't know the difference)!!!

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by: Massachusets Howler This user has validated their user name.

Sun Feb 1 14:56:50 2015

JD- The man who built Amazon.
MH
(Bezos could not have done it w/out him).

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by: Moonwishes This user has validated their user name.
Web Site

Mon Feb 2 01:44:16 2015

I too did most of my Christmas shopping on Amazon using my Amazon business credit card reward points and got quick shipping. After a month hubby noticed one of his gifts was wearing out way too fast. Got a quick refund with no questions. I do a lot of buying and selling on Amazon. I'm not at all surprised to see that amazon did so well.

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by: I Must be Crazy This user has validated their user name.

Mon Feb 2 11:52:58 2015

Amazon is better, hands down. I don't do much buying online though. The visibility and throttling that ebay puts me through has created cash flow problems going back to last May. A once fairly stable income has become so unreliable that I won't even buy a pair of shoes. Seeing as how the Paypal spinoff is the ONLY way to effect a change in management, it can't happen soon enough. When you're largest competitor grows by 15%, and your business 2%, it is apparent there is a lack of vision, direction, and common sense. Of course the person in charge had enough vision to secure a $23 million retention payment for himself before these results came out. I truly hope the next guy has a better approach.  

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