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SEC Filings

10-K
AMAZON COM INC filed this Form 10-K on 01/30/2013
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North America sales grew 30%, 43%, and 46% in 2012, 2011, and 2010, compared to the comparable prior year periods. The sales growth in each year primarily reflects increased unit sales, partially offset by a higher percentage of sales by marketplace sellers. Increased unit sales were driven largely by our continued efforts to reduce prices for our customers, including from our shipping offers, by sales in faster growing categories such as electronics and other general merchandise, by increased in-stock inventory availability, and by increased selection of product offerings.

International sales grew 23%, 38%, and 33% in 2012, 2011, and 2010, compared to the comparable prior year periods. The sales growth in each year primarily reflects increased unit sales, partially offset by a higher percentage of sales by marketplace sellers. Increased unit sales were driven largely by our continued efforts to reduce prices for our customers, including from our shipping offers, by sales in faster growing categories such as electronics and other general merchandise, by increased in-stock inventory availability, and by increased selection of product offerings. Additionally, changes in currency exchange rates impacted International net sales by $(853) million, $1.1 billion, and $(107) million in 2012, 2011, and 2010. We expect that, over time, our International segment will represent 50% or more of our consolidated net sales.

Supplemental Information

Supplemental information about shipping results is as follows (in millions):

 

     Year Ended December 31,  
     2012     2011     2010  

Shipping Activity:

      

Shipping revenue (1)(2)(3)

   $ 2,280      $ 1,552      $ 1,193   

Outbound shipping costs

     (5,134     (3,989     (2,579
  

 

 

   

 

 

   

 

 

 

Net shipping cost

   $ (2,854   $ (2,437   $ (1,386
  

 

 

   

 

 

   

 

 

 

Year-over-year Percentage Growth:

      

Shipping revenue

     47     30     29

Outbound shipping costs

     29        55        45   

Net shipping cost

     17        76        63   

Percent of Net Sales:

      

Shipping revenue

     3.7     3.2     3.5

Outbound shipping costs

     (8.4     (8.3     (7.5
  

 

 

   

 

 

   

 

 

 

Net shipping cost

     (4.7 )%      (5.1 )%      (4.0 )% 
  

 

 

   

 

 

   

 

 

 

 

(1) Excludes amounts earned on shipping activities by third-party sellers where we do not provide the fulfillment service.
(2) Includes a portion of amounts earned from Amazon Prime memberships.
(3) Shipping revenue for the year ended December 31, 2012, includes amounts earned from Fulfillment by Amazon programs related to shipping services.

We expect our net cost of shipping to continue to increase to the extent our customers accept and use our shipping offers at an increasing rate, our product mix shifts to the electronics and other general merchandise category, we reduce shipping rates, we use more expensive shipping methods, and we offer additional services. We seek to mitigate costs of shipping over time in part through achieving higher sales volumes, optimizing placement of fulfillment centers, negotiating better terms with our suppliers, and achieving better operating efficiencies. We believe that offering low prices to our customers is fundamental to our future success, and one way we offer lower prices is through shipping offers.

 

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