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Amazon.com Announces Conclusion of Fulfillment Agreement With drugstore.com

Amazon.com Continues Successful Migration to Direct Sourcing

SEATTLE, Oct. 27 /PRNewswire-FirstCall/ -- Amazon.com (Nasdaq: AMZN) has announced the conclusion of its fulfillment services agreement with drugstore.com, which had been providing fulfillment for a small portion of merchandise in Amazon.com's Health & Personal Care store.

This decision was mutually agreed upon by both parties and takes effect November 9. Amazon maintains its approximately 14% investment in drugstore.com as well as its seat on drugstore's board of directors.

"We've now built direct relationships with most major brands, including Procter & Gamble, Johnson & Johnson, Unilever, Bayer, Glaxo and dozens of others," said Doug Herrington, Amazon's vice president for consumables. "Going direct allows us to source more products at better prices, enabling us to deliver more value to customers."

Amazon.com launched its Health & Personal Care store in December 2003, and currently offers more than 400,000 unique items that are fulfilled by Amazon.com and over 1,000 HPC merchant partners. Drugstore.com accounted for less than 1% of Amazon's HPC selection.

Over the past twelve months, more than one million customers have made a purchase from Amazon's Health & Personal Care store. Thus far in 2005, Amazon's Health & Personal Care store has sold more than 16 million diapers, 2 million ounces of baby formula, and 860,000 nutrition bars.

All items from Amazon's Health & Personal Care store that are fulfilled by Amazon.com qualify for Free Super Saver Shipping and Amazon Prime, the company's membership program that offers unlimited, two day shipping for free for $79 per year.

About Amazon.com

Amazon.com, Inc., a Fortune 500 company based in Seattle, opened on the World Wide Web in July 1995 and today offers Earth's Biggest Selection. Amazon.com seeks to be Earth's most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. Amazon.com and other sellers offer millions of unique new, refurbished and used items in categories such as beauty, health and personal care, jewelry and watches, gourmet food, sports and outdoors, apparel and accessories, books, music, DVDs, electronics and office, toys and baby, and home and garden.

Amazon.com and its affiliates operate seven retail Web sites: www.amazon.com, www.amazon.co.uk, www.amazon.de, www.amazon.fr, www.amazon.co.jp, www.amazon.ca, and www.joyo.com.

As used herein, "Amazon.com," "we," "our" and similar terms include Amazon.com, Inc., and its subsidiaries, unless the context indicates otherwise.

Forward Looking Statement

This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results may differ significantly from management's expectations. These forward-looking statements involve risks and uncertainties that include, among others, risks related to potential future losses, significant amount of indebtedness, competition, management of growth, potential fluctuations in operating results, international expansion, outcomes of legal proceedings and claims, fulfillment center optimization, seasonality, commercial agreements, acquisitions, and strategic transactions, foreign exchange rates, system interruption, consumer trends, inventory, limited operating history, government regulation and taxation, fraud, and new business areas. More information about factors that potentially could affect Amazon.com's financial results is included in Amazon.com's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2004, and all subsequent filings.

SOURCE Amazon.com
10/27/2005

/CONTACT: Patty Smith of Amazon.com, +1-206-266-7180/
/Web site: http://www.amazon.com/


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