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7f25b8236d094454bbb7d5909bff515fc507cc381971ad9cab02dcb38530414c

The **operating cash flow** was notably high in Q1 2024 primarily because **net income increased dramatically** from **$3,172 million to $10,431 million**, which greatly boosted the operating cash flows. Additionally, there were **significant improvements in working capital**—including higher inflows from **inventories** (up to **$1,776 million**) and **unearned revenue** (**$1,568 million**), as well as a slightly smaller cash outflow in **accounts payable**. Increases in **non-cash adjustments**, such as **depreciation and amortization** and **stock-based compensation**, further enhanced the cash flows. These factors, combined with stronger business performance and growth in net sales, collectively contributed to the high operating cash flow in Q1 2024.  **[0001018724-24-000083_amzn-20240331.htm:2]** **[0001018724-24-000083_amzn-20240331.htm:26]** 

Why was Operating Cash Flow so high in Q1 2024?

Based on the provided documents, there is no information regarding a steep drop in **Free Cash Flow** in **Q3 2024**. The documents only detail the increase in **Purchases of Property and Equipment** and its causes in Q3 2024.  **[0001018724-23-000018_amzn-20230930.htm:2]** **[0001018724-24-000161_amzn-20240930.htm:2]** **[0001018724-24-000161_amzn-20240930.htm:32]** 

What caused the steep drop in Free Cash Flow in Q3 2024?

The sharp increase in capital expenditures in Q4 2024 was primarily due to **investments in technology infrastructure** aimed at supporting the growth of **Amazon Web Services (AWS)**, as well as expanding capacity for Amazon's **fulfillment network**. These investments reflect the company's strategy to fuel both its cloud services and logistic operations, and they are expected to drive further increases in capital expenditures in the future.  **[0001018724-25-000004_amzn-20241231.htm:42]** 

What led to the sharp increase in capital expenditures in Q4 2024?

0782074c8e89b9ee5ba0f23d4d4ad57a0c39c7f727556b475ba19f3035701bb4

Amazon's operating income in Q1 2024 was significantly high due to strong performance across its key segments. In the **North America** segment, higher unit and advertising sales drove operating income. The **International** segment turned around from a loss to income because of increased unit and advertising sales, despite modest increases in shipping and fulfillment costs. Meanwhile, the **AWS** segment benefited from increased sales, reduced payroll expenses, and lower depreciation and amortization costs due to updated estimates on server lifespans, with favorable foreign exchange impacts further boosting results. These factors combined to elevate operating income to **$15.3 billion** in Q1 2024.  **[0001018724-24-000083_amzn-20240331.htm:31]** **[AMZN_3381556_6]** 

Why was Operating income so high in Q1 2024?

Amazon's **spike in net income** in Q4 2024 was driven by multiple factors. Firstly, there was strong **revenue growth**, with net sales increasing by **10% year-over-year** to **$187.8 billion**, which significantly boosted financial performance. Secondly, **operating income** improved markedly, rising to **$21.2 billion** from **$13.2 billion**, reflecting better profitability across segments such as **North America**, **International**, and **AWS**. Additionally, the company achieved **lower global cost to serve** and experienced considerable **advertising revenue** growth. Despite a **$0.9 billion unfavorable foreign exchange impact**, these combined factors led to the substantial increase in net income in Q4 2024.  **[0001018724-25-000002_amzn-20241231xex991.htm:0]** **[AMZN_3414729_5]** 

What drove the spike in Net income in Q4 2024?

Amazon's EPS improved in Q4 2024 because the company nearly doubled its net income—from **$10.6 billion** in Q4 2023 to **$20.0 billion**—while recording strong revenue growth (a **10% increase** to **$187.8 billion**) and substantial gains in operating income across its key segments. Significant contributions came from higher profitability in North America, a turnaround in the International segment, and a **19% year-over-year growth** in AWS, all coupled with cost efficiencies and improved operational performance despite a **$0.9 billion** headwind from foreign exchange impacts.  **[0001018724-25-000002_amzn-20241231xex991.htm:0]** **[AMZN_3414729_5]** 

Why did EPS improve so much in Q4 2024?

Amazon's **FY 2024 net income surge** was driven by several factors. **Higher operating income** played a major role, as the company saw substantial gains across its segments—**North America** benefited from increased unit sales and advertising revenue, the **International segment** turned around from a loss to a profit, and the **AWS segment** experienced robust growth.  **[0001018724-25-000002_amzn-20241231xex991.htm:1]** **[0001018724-25-000004_amzn-20241231.htm:49]**  Additionally, **improved non-operating income** was evident with higher interest income, despite a decline in other income due to a loss on its equity investment.  **[0001018724-25-000004_amzn-20241231.htm:49]**  Finally, the overall effect was supported by **tax benefits**, including **$2.8 billion in excess tax benefits from stock-based compensation**, which helped to moderate the increase in the provision for income taxes.  **[0001018724-25-000004_amzn-20241231.htm:94]** 

What factors contributed to the FY 2024 net income surge?

532c5c8ae24c450501d945913ac20f259a5ca18cdf1fd9b951f257aa8675fd94

Net Income (Loss) (USD, millions)

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1909b8d003a6fff75e844a16d54342c02fcad149964f754d632a556930b5c98f

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83c527376ab797d9989ae26f5906878a36d648e64073fc9ec9ccb81d8da20dc7

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d962114240ea9c56e78f31f9b8ace731fc6ce3090f8f708c656b93bfa4d21c41

1a9ff2b87b5d305b3d680a832cc35eccc5b3fece7f9dc77cc0e2dc0fb4f9f06f

bf86a4aeda5a582733b30a3dc1449a4d69b271c41bd0c736b0b5cf8f39ebfff7

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AMAZON COM (AMZN)

Financials