Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its second quarter ended June 30, 2017.

Operating cash flow increased 37% to $17.9 billion for the trailing twelve months, compared with $13.0 billion for the trailing twelve months ended June 30, 2016. Free cash flow increased to $9.7 billion for the trailing twelve months, compared with $7.7 billion for the trailing twelve months ended June 30, 2016. Free cash flow less lease principal repayments increased to $5.5 billion for the trailing twelve months, compared with $4.2 billion for the trailing twelve months ended June 30, 2016. Free cash flow less finance lease principal repayments and assets acquired under capital leases decreased to $1.5 billion for the trailing twelve months, compared with $2.9 billion for the trailing twelve months ended June 30, 2016.

Common shares outstanding plus shares underlying stock-based awards totaled 502 million on June 30, 2017, compared with 495 million one year ago.

Net sales increased 25% to $38.0 billion in the second quarter, compared with $30.4 billion in second quarter 2016. Excluding the $502 millionunfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 26% compared with second quarter 2016.

Operating income decreased 51% to $628 million in the second quarter, compared with operating income of $1.3 billion in second quarter 2016.

Net income was $197 million in the second quarter, or $0.40 per diluted share, compared with net income of $857 million, or $1.78 per diluted share, in second quarter 2016.

“Our teams remain heads-down and focused on customers,” said Jeff Bezos, Amazon founder and CEO. “In the last few months, we launched Echo Show (our newest Echo device with a video screen), introduced calling and messaging via Alexa on all Echo devices, debuted Inside Edgeon Prime Video (the first of 18 Indian Original Series), introduced Amazon Channels in both the U.K. and Germany, launched four new Fire tablets, expanded Amazon Fresh to Germany, launched Prime Now in Singapore, launched our 25th airplane with Prime Air, hired more than 30,000 new employees, opened three new Amazon Books stores, launched more than 400 significant AWS features and services, migrated more than 7,000 databases using AWS Database Migration Service, and held our third annual Prime Day — signing up more Prime members than ever before. It’s energizing to invent on behalf of customers, and we continue to see many high-quality opportunities to invest.”

Highlights

  • The third annual Prime Day was the biggest global shopping event ever for Amazon with more new Prime members joining Prime than any single day in Amazon history. Hundreds of thousands of small businesses and entrepreneurs participated in the global event and sold more than 40 million units.
  • Prime Day was the biggest sales event ever for Amazon devices worldwide, including record sales for Echo, Fire tablets, and Kindle devices. The Echo Dot was the best-selling Amazon device this Prime Day and was the best-selling product from any manufacturer in any category across Amazon globally. The All-New Element 55-inch 4K Ultra HD Smart LED TV — Amazon Fire TV Edition was the best-selling TV deal in Amazon history, selling through record units in less than four hours.
  • Amazon Studios released The Big Sick in theaters nationwide, starring Kumail Nanjiani, Zoe Kazan, Holly Hunter, and Ray Romano. The Big Sick has gained widespread critical acclaim, earning a score of 98% on Rotten Tomatoes and a metascore of 87 on Metacritic.
  • Amazon Video received 16 Emmy nominations, including nominations for Original Series TransparentThe Man in the High CastleMozart in the Jungle, and Catastrophe.
  • Amazon Studios will premiere a slate of new Original Series and Movies in the coming months, including new Original Series The Last Tycoon,The TickThe Marvelous Mrs. Maisel, and the second season of The Grand Tour, as well as the theatrical debut of Original Movies Last Flag Flying, Wonderstruck, and Wonder Wheel.
  • Prime Video launched its first Indian Amazon Original, Inside Edge. This ten-episode series combines the worlds of cricket and entertainment and is available in over 200 countries and territories worldwide.
  • Amazon Channels launched in the U.K., Germany, and Austria, bringing Prime members the choice to subscribe to a wide range of live and on-demand TV channel subscriptions, including Discovery and Eurosport Player in the U.K., as well as MGM and GEO Television in Germanyand Austria.
  • Amazon introduced Echo Show, a new Echo device that gives customers everything they love about Alexa, now with a video screen. Just ask and view music lyrics with Amazon Music, box scores from last night’s game, video clips, camera feeds, Prime Photos, and more. In addition,Echo Show can instantly connect with family and friends through video calling and messaging.
  • Amazon launched calling and messaging via Alexa on Echo devices. Hands-free calling, video calling, and messaging bring family and friends closer together, making Amazon Echo a communal device in your home. Additionally, Alexa keeps getting even smarter with customer-requested features such as proactive reminders and named timers.
  • Amazon introduced new Alexa smart home capabilities for customers, including the ability to use Alexa to control entertainment devices like televisions, connected speakers, and remotes; view feeds from smart cameras on their Echo Show; control Roomba vacuum cleaners; or turn their IKEA smart lights on and off.
  • The Alexa Skills store now offers customers more than 15,000 skills. Customers can listen to over 200 channels from SiriusXM, check theirAmerican Express account, watch trailers and purchase movie tickets from Fandango, and more.
  • Amazon added four new Fire tablets to its lineup, including the all-new Fire 7, the next generation of Amazon’s best-selling tablet; the all-new Fire HD 8, the next generation of Amazon’s highest customer-rated tablet; and two new tablets built from the ground up for kids — the Fire 7 Kids Edition and Fire HD 8 Kids Edition.
  • Amazon and Migu, a subsidiary of China Mobile with one of the largest online reading libraries in China, announced the Kindle X Migu E-reader, an entirely new Kindle created exclusively for readers in China. The new Kindle combines features readers love about Kindle with over 460,000 eBooks from the Kindle Store and over 400,000 online literature titles from Migu.
  • Amazon launched Prime Now in Singapore, offering free two-hour delivery on tens of thousands of items. Customers can shop on the Prime Now app for everything on their list from eggs, cold beer, and ice cream to baby strollers, toys, and consumer electronics.
  • AmazonFresh is now available in Germany, including Berlin and Hamburg, offering customers a broad selection of groceries in addition to everyday products.
  • Amazon Business now serves more than one million business customers in the U.S., offering business-only discounted pricing on millions of items and access to more than 85,000 business sellers.
  • Amazon hosted Boost with FBA, a summit for small business and entrepreneurs participating in the FBA program. The inaugural event brought together more than 1,000 entrepreneurs and small business owners to meet with Amazon leaders and learn more about the tools and services available for growing their businesses.
  • Amazon Books recently opened bookstores in Lynnfield, MA, Paramus, NJ, and New York, NY, and now has eight bookstores across the U.S. with five more stores coming soon. Amazon Books integrates the benefits of offline and online shopping to help customers discover books and devices.
  • Amazon Web Services (AWS) announced that Ancestry, the global leader in family history and consumer genomics; Hightail, a virtual workspace for creative collaboration and file sharing; and California Polytechnic State University are going all-in on AWS. Other enterprise customers that have recently chosen AWS to run significant production workloads include Discovery Communications, Morningstar, BP, andZillow Group.
  • AWS customers continue to ramp their use of Amazon Machine Learning and Artificial Intelligence services with American Heart Association, Freshdesk, HubSpot, Aylesbury Vale District Council, Capital One, OhioHealth, NASA, Liberty Mutual Insurance, Vonage, and Kelley BlueBook using natural language chat bots via Amazon Lex; The Washington Post, Duolingo, BeeLiked, GoAnimate, WizKids, Royal National Institute for the Blind, Y-cam, Mapbox, iTranslate, InHealthcare, Storybulbs, Aculab, and Aloud! enhancing customer engagement with Amazon Polly’s text-to-speech capabilities; and C-SPAN, Motorola Solutions, Openinfluence, Go Girl, Bynder, HYPR, TheTake, Witlee, RealTimes, and the Washington County Sheriff’s Office which are identifying on-camera personalities, celebrities, and people of interest using Amazon Rekognition.
  • AWS announced that in 2018 it will open a new infrastructure region in Hong Kong and a second GovCloud region in the U.S. AWS currently operates 44 Availability Zones across 16 infrastructure regions worldwide, with announced plans for another 14 Availability Zones across five AWS Regions.
  • AWS announced the general availability of AWS Greengrass, software that allows customers to run AWS compute, messaging, data caching, and sync capabilities on connected devices. Enel, Konecranes, Pentair, Rio Tinto, and Stanley Black & Decker are among the customers using AWS Greengrass to allow connected devices to perform some tasks locally while leveraging the full processing, analytics, and storage power of the AWS Cloud. More than a dozen AWS partners including BSquare, Canonical, Digi International, Intel, Lenovo, Mongoose, Nokia, Qualcomm Technologies, Raspberry Pi, Samsung, Technicolor, and Wistron are integrating AWS Greengrass into their platforms so devices will come with AWS Greengrass built-in.
  • AWS announced the general availability of Amazon DynamoDB Accelerator (DAX), a fully-managed, highly available, in-memory cache that can reduce Amazon DynamoDB response times from milliseconds to microseconds, even at millions of requests per second. With DAX, customers using DynamoDB for mobile, web, gaming, ad tech, IoT, and many other types of applications can achieve 10x faster query performance.
  • AWS announced the availability of G3 instances, the next generation of GPU-powered Amazon Elastic Compute Cloud (Amazon EC2) instances designed for graphics-intensive workloads like 3D rendering, 3D visualization, video encoding, and virtual reality applications. Backed by NVIDIA Tesla M60 GPUs, G3 instances offer double the CPU power per GPU and double the host memory per GPU than the prior most powerful GPU cloud instance available.
  • AWS announced that customers have migrated more than 30,000 databases using the AWS Database Migration Service since it became generally available in 2016.
  • Amazon announced that more than 10,000 employees have participated in Career Choice, and that it expects to reach 20,000 participants by 2020. Career Choice is Amazon’s innovative career training program that pre-pays 95% of tuition for high-demand fields, regardless of whether they are relevant to a career at Amazon. Career Choice has dedicated on-site classrooms at 25 fulfillment centers, and has expanded the program to include in-demand fields such as robotics and photovoltaic certifications.
  • Amazon now has more than 10 large-scale solar installations on fulfillment center rooftops, and remains on track to install 50 or more by 2020. Amazon was the leading corporate purchaser of renewable energy in the U.S. in 2016, according to the 2017 State of Green Business report.
  • Amazon donated more than 47,000 square feet of space within its newest headquarters building to Mary’s Place Family Shelter in Seattle, which will include 65 rooms to help shelter more than 200 homeless women, children, and families each night. Additionally, Amazonannounced that it will match donations up to $1 million through the end of the year made to Friendship Place, a leader in the Washington, D.C., region in developing innovative solutions to end homelessness. Amazon also donated $1 million and 25,000 square feet of space within its Seattle headquarters to FareStart, a leader in transforming the lives of people who are homeless or living in poverty through its culinary job training and employment placement programs. The donations will help FareStart open five new eateries and launch a foodservice apprenticeship program to help people living in poverty obtain higher income jobs.