AMAZON.COM ANNOUNCES FINANCIAL RESULTS FOR FIRST QUARTER 1999
PR NEWSWIRE - April 28, 1999 16:27
Amazon.com's Community of Online Shoppers Grows to Over 8.4 Million
SEATTLE, April 28 /PRNewswire/ -- Amazon.com, Inc. (Nasdaq: AMZN) today announced financial results for the first quarter of 1999. Net sales for the first quarter were $293.6 million, an increase of 236 percent over net sales of $87.4 million for the first quarter of 1998.
Amazon.com reported a first-quarter pro forma operating loss of $30.6 million, or 10 percent of net sales, compared to an operating loss of $10.0 million, or 11 percent of net sales, in the first quarter of 1998. First-quarter pro forma net loss of $36.4 million, or $0.23 per share, compared with a net loss of $10.4 million, or $0.07 per share, in the first quarter of 1998. On a GAAP basis, reported first-quarter net loss was $61.7 million, or $0.39 per share, and included $25.3 million of merger- and acquisition-related costs.
Amazon.com announced that cumulative customer accounts increased by more than 2.2 million during the first quarter to more than 8.4 million at March 31, 1999, an increase of more than 250 percent from the 2.3 million customer accounts at March 31, 1998. Repeat customer orders represented more than 66 percent of orders during the quarter ended March 31, 1999.
"Everyone here is working hard to provide the best possible customer experience, and we're extremely grateful to our customers," said Jeff Bezos, Amazon.com founder and CEO. "We're particularly pleased with Amazon.com Auctions, which is off to a very fast start -- we had more participants during our first month then even with music."
The company's focus on customers enabled Amazon.com to extend its leadership position on a number of fronts:
* Amazon.com was ranked in the top 10 Web properties during March, as
measured by Media Metrix, making it not only the leading online retail
site but also one of the leading Web sites of any kind. * In March, Amazon.com was the only company to win more than one Webby
award -- and it won three. The Webbies, considered by many to be the
Oscars(R) of the Internet, are awarded by the International Academy of
Digital Arts & Sciences. Amazon.com won awards for Web-site excellence as a commerce site, for technical achievement, and the company's
Internet Movie Database ( imdb.com ) for best film site.
IMDb also received a People's Choice Award (voted for by Web users) in
the film category. * More than 1 million Amazon.com customers have now signed up for the
company's innovative Delivers program, which provides periodic e-mail updates of new book, music, and video titles. More information on
Delivers is available at www.amazon.com/delivers. * More than 260,000 Web-site operators have now enrolled in the company's
industry-leading Associates program, which allows Web-site operators to
earn lucrative referral fees over a range of products. More information
on Associates is available at www.amazon.com/associates.
Regarding Amazon.com's announced 1999 expansion plans, Bezos added, "We have begun and will continue to build out a significant distribution infrastructure. This will give customers greater availability, faster shipping times, and even better service. We will also continue to invest in systems, people, and product expansion, each of which helps us better serve customers. For the rest of 1999, we expect to invest more heavily than we have in the past. Our goal remains to build the world's most customer-centric company."
Recent Highlights
Amazon.com Auctions
In March, Amazon.com launched Amazon.com Auctions to help people find, discover, buy -- and now sell -- virtually anything online. With the launch of Amazon.com Auctions, Amazon.com's more than 8.4 million customers have been preregistered to begin buying and selling immediately in more than 800 categories. The new service is easy to use, with innovative and time-saving features such as Bid-Click(SM) for hassle-free bidding. To enhance customer safety, the Amazon.com Auctions Guarantee covers purchases of up to $250 in the event that a buyer does not receive what a seller promised.
Earlier this month, Amazon.com announced it had agreed to purchase LiveBid.com, the sole provider of live-event auctions on the Internet. Adding LiveBid's technology and services to Amazon.com Auctions expands the breadth and types of items customers will find and gives local and regional auction houses full access to a vast Internet auction community.
drugstore.com and Pets.com
During the quarter, Amazon.com announced strategic investments in drugstore.com and Pets.com. drugstore.com (www.drugstore.com) is an online source for thousands of brand-name health, beauty, and wellness products. Pets.com (www.pets.com/) is the leading pet-oriented company on the Internet, specializing in popular and rare pet accessories, products, and food for all types of animals. These companies share Amazon.com's passion for bringing customers value through selection, service, convenience, and community.
Amazon.com's Free Greeting Card Service
On April 27 the company launched Amazon.com Cards, a free electronic greeting-card service. Cards can be sent by visiting www.amazon.com and clicking on the e-cards tab. The new site offers diverse styles of electronic greeting cards and a unique selection, with hundreds of illustrations, pictures, animated cards, and messages to choose from. Card senders also have the ability to customize their messages.
Distribution Center Expansion
Continuing its expansion, Amazon.com leased a distribution facility in Coffeyville, Kansas, which will enable faster delivery to Amazon.com customers across the Midwest and Southeast United States. Plans for the existing 460,000-square-foot facility include expansion to over 750,000 square feet and the addition of automation, allowing the company to significantly increase the number of products kept on hand for immediate shipment to customers. The result is that customers in such places as Chicago, St. Louis, Dallas, and Minneapolis will receive their orders much faster, thanks to deeper inventory, faster processing, and shorter delivery times. The Coffeyville facility is expected to begin operations during the second half of 1999.
Amazon.com also announced that its 323,000-square-foot facility in Fernley, Nevada began shipping on a limited basis, increasing availability and improving delivery times for customers in the Western U.S.
In March, Amazon.de leased a new distribution center in Bad Hersfeld, Germany. The facility is expected to begin operations during the second half of 1999.
Acquisition of Bibliofind.com and MusicFile.com
Earlier this week, the company agreed to acquire Exchange.com, the premier online marketplace for hard-to-find, antiquarian, and used books at www.bibliofind.com and hard-to-find recordings and music memorabilia at www.musicfile.com. The acquisition will vastly enlarge and enrich Amazon.com's core book- and music-store offerings while providing Exchange.com's thousands of independent dealers and retailers the opportunity to sell and auction their hard-to-find books, recordings, and memorabilia to Amazon.com's growing base of 8.4 million experienced online shoppers. At the same time, the company also announced it had agreed to acquire two other e-commerce companies, Alexa.com and Access.com.
Financing
Early in the quarter, Amazon.com completed a $1.25 billion 4.75% convertible debt offering, which substantially strengthened its cash position and increased its strategic flexibility. Also in the quarter, Amazon.com repurchased $84 million in accreted value of its senior discount notes.
About Amazon.com
Amazon.com, Inc., the Internet's No. 1 music, No. 1 video, and No. 1 book retailer, opened its virtual doors on the World Wide Web in July 1995. Today, the Amazon.com store has expanded to offer online auctions and more than 4.7 million book, music-CD, video, DVD, computer-game, and other titles, plus secure credit-card payment, personalized recommendations, and streamlined ordering through 1-Click(SM) technology and hassle-free auction bidding with Bid-Click(SM).
Amazon.com operates two international Web sites: www.amazon.co.uk in the United Kingdom and www.amazon.de in Germany. Amazon.com also operates PlanetAll (www.planetall.com), a Web-based address book, calendar, and reminder service. It also operates the Internet Movie Database (www.imdb.com), the Web's comprehensive and authoritative source of information on more than 150,000 movies and entertainment programs and 500,000 cast and crew members dating from the birth of film in 1892 to the present.
This announcement contains forward-looking statements that involve risks and uncertainties that include, among others, Amazon.com's limited operating history, anticipated losses, unpredictability of future revenues, potential fluctuations in quarterly operating results, seasonality, consumer trends, competition, risks of system interruption, management of potential growth, risks related to auction services, and risks of new business areas, international expansion, business combinations, and strategic alliances. 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
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