Amazon.com, Inc. (NASDAQ:AMZ) reported sales for 2018 of $232.9 billion, an increase of 31 percent from $177.9 billion the previous year. Excluding the $1.3 billion favorable impact from year-over-year changes in foreign exchange rates throughout the year, net sales increased 30 percent compared with 2017. Operating income increased to $12.4 billion, compared with operating income of $4.1 billion in 2017. Net income increased to $10.1 billion, compared with net income of $3 billion in 2017.  

Fourth Quarter 2018

Sales for the fourth quarter, ended Dec. 31, 2018, were $72.4 billion, up 20 percent year-over-year over $60.5 billion in the 2017 fourth quarter. Profit for the quarter was $3 billion, compared to a $1.9 billion the same period a year ago.Excluding the $801 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 21 percent compared with fourth quarter 2017. Operating income increased to $3.8 billion in the fourth quarter, compared with operating income of $2.1 billion in fourth quarter 2017.   

Net income increased to $3 billion in the fourth quarter, compared with net income of $1.9 billion in fourth quarter 2017. The fourth quarter 2017 included a provisional tax benefit for the impact of the U.S. Tax Cuts and Jobs Act of 2017 of approximately $789 million.   

Operating cash flow increased 67% to $30.7 billion for the trailing twelve months, compared with $18.4 billion for the trailing twelve months ended December 31, 2017. Free cash flow increased to $19.4 billion for the trailing twelve months, compared with $8.3 billion for the trailing twelve months ended December 31, 2017. 

Free cash flow less lease principal repayments increased to $11.6 billion for the trailing twelve months, compared with $3.3 billion for the trailing twelve months ended December 31, 2017. 

Free cash flow less finance lease principal repayments and assets acquired under capital leases increased to an inflow of $8.4 billion for the trailing twelve months, compared with an outflow of $1.5 billion for the trailing twelve months ended Dec. 31, 2017. Common shares outstanding plus shares underlying stock-based awards totaled 507 million on Dec. 31, 2018, compared with 504 million one year ago.  

“Alexa was very busy during her holiday season” said Jeff Bezos, Amazon founder and CEO. “Echo Dot was the best-selling item across all products on Amazon globally, and customers purchased millions more devices from the Echo family compared to last year. The number of research scientists working on Alexa has more than doubled in the past year, and the results of the team’s hard work are clear. 

“In 2018, we improved Alexa’s ability to understand requests and answer questions by more than 20 percent through advances in machine learning, we added billions of facts making Alexa more knowledgeable than ever, developers doubled the number of Alexa skills to over 80,000, and customers spoke to Alexa tens of billions more times in 2018 compared to 2017. We’re energized by and grateful for the response, and you can count on us to keep working hard to bring even more invention to customers.”