Tom Szkutak, CFO Goldman Sachs Eighth Annual Internet Conference May 24th, 2007 .com This presentation may contain forward-looking statements, including statements regarding expectations of sales, gross margin, productivity, leverage, operating results, consolidated segment operating results, capital investment, return on capital, free cash flow and other financial statement or balance sheet items or ratios, all of which are inherently difficult to predict. Actual results could differ materially for a variety of reasons, including fluctuations in foreign exchange rates, changes in global economic conditions and consumer spending, world events, the rate of growth of the Internet and online commerce, the amount that Amazon.com invests in new business opportunities and the timing of those investments, the mix of products sold to customers, the mix of net sales derived from products as compared with services, the extent to which we owe income taxes, competition, management of growth, potential fluctuations in operating results, international growth and expansion, the outcomes of legal proceedings and claims, fulfillment center optimization, risks of inventory management, seasonality, the degree to which the Company enters into, maintains and develops commercial agreements, acquisitions and strategic transactions, and risks of fulfillment throughput and productivity. Other risks and uncertainties include, among others, risks related to new products, services and technologies, system interruptions, significant indebtedness, government regulation and taxation, payments, and fraud. 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 for the year ended December 31, 2006, and all subsequent filings. Additional information relating to certain of our financial measures contained herein is available in the appendix to our presentation, our most recent earnings release and at our website at www.amazon.com/ir under ‘Financial Documents’. 2 Amazon.com Agenda

Our Model

Our Results

Our Strategy

3 Our Model

4 Our Model Capital Efficiency -- Centralized Distribution

Physical Store Amazon.com

Headquarters

Warehouses

Stores

Lower Invested Capital = Higher Return 5 Our Model Balance Sheet ($MM) Q1 2002 Q1 2007 Assets Cash & Marketable Securities $745 $1,420 TTM Free Cash Flow $521 Inventories 139 754 13 Turns / 6% of Sales A/R, Deferred Tax Assets & Other 70 426 $1,196 in “operating Total Current Assets 954 2,600 assets” Fixed Assets, net 256 442 Deferred Tax Assets & Other 152 619 Total Assets $1,362 $3,661 Liabilities and Stockholders’ Equity A/P & Other Current Liabilities $657 $1,847 Long-Term Debt and Other 2,152 1,461 Principal Due 2009 / 2010 Stockholders’ Equity (1,447) 353 Total Liabilities & Stockholders’ Equity $1,362 $3,661 6 Our Model is Demonstrating its Efficiency Our Model Q107 Capital Efficiency -- Operating Cycle (TTM) (1)

19 Days

Day 0 28 31 50

Product Product Customer Supplier Received Shipped Payment Paid

Working Capital is a Source of Cash 7 (1) As of 3/31/07 – TTM Inventory Days, Approximate AR Days and TTM Ending AP Days Our Model Pre-orders

Capture Early Demand and Improve Inventory Forecasting 8 Our Model Inventory Velocity

Hypothetical Example -- Digital Camera Physical Store Amazon.com Average Selling Price $300 $300 Turns -- TTM 6.4 12.9 Obsolescence Hypothetical Value -- One Year Later $210 $210

Obsolescence Loss Per Week (30% per Year) $1.7 $1.7 Average Weeks in Inventory 8.7 4.0 Obsolescence Cost Per Unit $14.7 $6.8 As a % of Sales 4.9% 2.3%

Inventory Velocity Translates to Cash Benefit 9 Our Model Technology

Performance / $ Internet Penetration / Users Optical Fiber -- Doubles 9 months (bits per second) Web Services

Data Storage -- Doubles 12 months Bandwidth (bits per square inch) Wireless Silicon (Moore’s Law) -- Doubles 18 Months (number of transistors) Instant On

0 Years 5 Third Parties Source: Vinod Khosla, Kleiner Perkins Caufield & Byers, 2000

Technology is our Ally -- It Will Only Get Better 10 Amazon.com

Our Results

11 Our Results Free Cash Flow – TTM (1) ($MM) $52 $22

$227 ($205) $241 ($189)

(11) (95) $124 $521 $429

Q1 07 Stock-based Change in Change in Depreciation CapEx Net Interest Other, Net Q1 07 GAAP Compensation Accounts inventories & Amortization Expense FCF Operating Payable & Other Income Leverage in Earnings, Working Capital 12 (1) Free cash flow, a non-GAAP financial measure, is GAAP Operating Cash Flow Less Capital Expenditures. See the appendix for reconciliation of free cash flow to operating cash flow Our Results Free Cash Flow -- TTM (1) ($MM) Up 4% Y/Y $600 $521 (2) $486 $501 (2)

$300

$135

$0 2002 2003 2004 2005 2006 Q1 06 Q1 07 Long Term Goal -- Optimize Free Cash Flow Per Share

(1) Free cash flow is a non-GAAP financial measure. See the appendix for reconciliation of free cash flow to operating cash flow. (2) In Q3 05, the Company settled a patent lawsuit on terms including a one time payment of $40MM. This negatively 13 impacts TTM free cash flow for all periods that include Q3 05. Our Results Shares (MM) 450 433 436 438 430 (1) 45 22 21 21 (2)

225 388 414 417 409

0 2002 2003 2004 2005 2006 Q1 06 Q1 07

Shares Outstanding Stock-Based Awards Outstanding Efficiently Managing Dilution -- Down 2% Y/Y (1) The Company repurchased 8MM shares in Q3 06 14 (2) The Company repurchased 6MM shares in Q1 07 Our Results Return on Invested Capital -- TTM (1)

50%

34% 32% 28% 30% 25% 17%

0% 2002 2003 2004 2005 2006 Q1 06 Q1 07

Long-term Expectation: Triple Digit ROIC 15 (1) ROIC = TTM Free Cash Flow divided by 5 quarter average of (Total Assets less Total Current Liabilities) Our Results Net Sales -- TTM ($MM) $11,447 $10,711 $10,000 $8,867

$5,000 $3,933

$0 2002 2003 2004 2005 2006 Q1 06 Q1 07

TTM Q1 07 Up 29%, Up 27% Excluding Effect of F/X 16 Our Results Segments and Net Sales

Segments • North America • International Net Sales Categories • Media • Electronics and Other General Merchandise (EGM) • Other

17 Our Results Net Sales Mix -- TTM ($MM) Q1 02 Worldwide Sales Mix Q1 07 Worldwide Sales Mix Total Sales $3,269 Total Sales $11,447

$78 $299 2% 3% $3,669 $617 32% 19%

$2,574 $7,479 79% Media 65%

Electronics and Other General Merchandise

Other (Amazon Enterprise Solutions (AES), Co-Branded 18 Credit Card & Misc. Marketing) Our Results Net Sales Mix -- TTM ($MM) North America – Q1 02 North America – Q1 07 $78 $273 $590 $2,214 3% 5% 24% 35%

$3,757 $1,845 60% 73% International – Q1 02 International – Q1 07 $27 $0 $26 4% N/A $1,455 N/A 28%

$729 96% $3,722 Media 72% Electronics and Other General Merchandise 19 Other (AES, Co-Branded Credit Card & Misc. Marketing) Our Results International Sales -- TTM ($MM)

$4,842 $5,203UK, Germany, France, Japan, & China

$3,936 45% of WW ~ up from 44% in Q1 06, and up from 23% in Q1 02.

$5,000 LT Expectation -- Over 50% of Sales $1,172 Shipments to Over 200 Countries

Operating Profit up 15% to $306MM $2,500 Operating Margin of 5.9%

$0 2002 2003 2004 2005 2006 Q1 06 Q1 07

TTM Q1 07 Up 32%, Up 27% Excluding Effect of F/X 20 Our Results

Gross Profit -- TTM $2,628Up 23%27% Y/Y ($MM)$2,500 $2,456 $2,128 25%

24% 24% $1,250 $992 23% 23%

$0 21%

2002 2003 2004Gross Profit 2005 2006 Q1 06Gross Q1 Margin 07 Objective: Maximize Gross Profit Dollars, Not Margin 21 Our Results Consolidated Segment Operating Income (Loss) (1) TTM ($MM) $600 $558 $560 10% $500

$300 6% 5% $180 5% 5% 5%

$0 - 2002 2003 2004 2005 2006 Q1 06 Q1 07

Objective: Maximize Operating Profit Dollars, Not Margin 22 (1) See the appendix for a reconciliation of consolidated segment operating income to operating income. Our Results First Quarter Highlights (1) ($MM) Q1 06 Q1 07 V% ex F/X

Free Cash Flow -- TTM $ 501 $ 521 4%

Net Sales $ 2,279 $ 3,015 32% 29%

Gross Profit $ 547 $ 719 31%

Gross Margin 24.0% 23.8% -17 bps

Direct Segment Operating Expenses $ 427 $ 540 26% As a % of Sales 18.8% 17.9% -86 bps Consolidated Segment Operating Income $ 120 $ 179 50% 44%

Consolidated Segment Operating Margin 5.3% 6.0% 69bps

Topline Growth Fueled by Focus on Customer Experience – Selection, Convenience and Price 23 (1) See the appendix for a reconciliation of consolidated segment operating income to operating income Amazon.com

Our Strategy

24 Our Strategy Vision

Earth’s Biggest Selection Build a place where people can find and discover anything they want to buy online and endeavor to offer customers the lowest possible prices.

Earth’s Most Customer-Centric Company Start with the customer and work backwards

25 Customer Experience Pillars Price Selection Convenience

I N N O V A T I O N 26 Our Strategy Our Virtuous Cycle

Lower Cost Lower Structure Prices Selection & Convenience

Sellers Growth Customer Experience

Traffic

Over 66MM Active Customer Accounts, Up 15% Y/Y 27 Our Strategy Leveraging our Platform

70% of Units (1) Amazon.com Our Inventory as Seller Our Product Detail Pages

30% of Units (1) Merchants@/ 3rd Party Inventory Marketplace Our Product Detail Pages

Amazon Enterprise Our Technology Solutions Powers Partner Websites

Amazon Web Web Scale Computing Services Simple API’s 28 (1) Q1 2007 Selection Third Party – Merchants@ Amazon.co.uk

29 Selection Third Party – Marketplace

30 Selection Fulfillment By Amazon

31 Selection Amazon.com – Groceries

Launched - July 2006 32 Selection Groceries – Subscribe & Save

33 Selection Amazon.de – Sporting Goods

Launched - July 2006 34 Selection Amazon.co.jp – Health and Beauty

Launched - August 2006 35 Selection Amazon.com – Automotive

Launched - October 2006 36 Selection endless.com

Launched - December 2006 37 Selection Amazon.co.uk – Sports & Leisure

Launched - March 2007 38 Selection Amazon.fr – Toys

Launched - April 2007 39 Selection Watches & Jewelry

Amazon.co.jp - Launched April 2007; Amazon.co.uk – Launched May 2007; Amazon.de – Launched May 2007 40 Global Selection US UK Germany France Japan Canada China Books ‘95 ‘98 ‘98 ‘00 ‘00 ‘02 ‘04 Music/Video ‘98 ‘99 ‘99 ‘00 ‘01 ‘02 ‘04 DVD/Rental* ‘98 ’99/’04* ’99/’05* ‘00 ‘01 ‘02 ‘04 Video Games & Software ‘99 ‘00 ‘00 ‘01 ‘01 ‘03 ‘04 Electronics ‘99 ‘01 ‘01 ‘05 ‘03 ‘04 Toys & Baby ‘99 ‘01 ‘04 ‘07 ‘04 ‘04 Tools & Hardware ‘99 ‘04 ‘04 Kitchen & Housewares ‘00 ‘04 ‘04 ‘03 ‘06 Magazines ‘01 ‘02 ‘04 Office Products ‘02 Apparel & Accessories ‘02 Sports & Outdoors ‘03 ‘07 ‘06 ‘05 Gourmet Food ‘03 Jewelry/Watches ‘03 ’07 ’07 ’07 ‘06 Health & Personal Care ‘03 ‘06 ‘06 Beauty ‘04 ‘06 Musical Instruments ‘04 Grocery ‘06 Automotive ‘06 Third Party Sellers Marketplace ‘00 ‘02 ‘02 ‘03 ‘02 ‘03 Merchants@ ‘02 ‘06 ‘06 ‘07 41 Expect More Category and Country Expansion Over Time Our Strategy Amazon Enterprise Solutions

Partners Also Include: Bebe, Benefit Cosmetics, Bombay Company, DVF, Mothercare, Sears.ca, Target, Timex 42 Convenience

43 Convenience Amazon Unbox

Thousands of Titles from over 30 Studio and Network Partners 44 Price

Over $600 Million in Foregone Shipping Revenue (1)

And

Everyday Low Pricing Our objective is not to discount a small number of products for a limited period of time, but to offer low prices everyday and apply them broadly across our entire product range.

45 (1) Q107 TTM Price Free Shipping U.S.

U.K.

JP

FR La livraison gratuite à partir de 20 euros d'achats !

DE

CA

CN 购物满99元免配送费 46 Our Developer Business

Delivering Web-Scale Computing Over 240,000 registered developers (>50% Yr/Yr) 10 different web service offerings, including: •Amazon Simple Storage Service () •Amazon Elastic Compute Cloud (Amazon EC2)

Developer’s Idea → AWS → Successful Product 47 Amazon.com Summary

The Online Retail Model is Advantaged We Face Many Challenges and Many Opportunities -- We Are: • Relentlessly Improving Customer Experience -- Expanding Selection and Convenience While Lowering Prices • Leveraging Our Platform • Well Positioned for Growth • Focused on Optimizing LT Free Cash Flow per Share Innovation is the Foundation of Everything We Do

48

Appendix Free Cash Flow Reconciliation -- TTM ($MM)

Q1 06 Q2 06 Q3 06 Q4 06 Q1 07

Operating Cash Flow $724 $610 $587 $702 $726

Less: Purchases of Fixed Assets, including capitalized software development 223 235 221 216 205

Free Cash Flow $501 $375 $366 $486 $521

51 Free Cash Flow Reconciliation -- TTM ($MM)

2002 2003 2004 2005 2006

Operating Cash Flow $174 $393 $566 $733 $702

Less: Purchases of Fixed Assets, including capitalized software development 39 46 89 204 216

Free Cash Flow 135 $347 $477 $529 $486

52 Consolidated Segment Operating Income Reconciliation ($MM)

Q1 06 Q2 06 Q3 06 Q4 06 Q1 07

Consolidated Segment Operating Income $ 120 $ 80 $ 72 $ 229 $179 Less:

Stock-Based Compensation 11 30 30 30 34

Other Operating Expense (Income) 3 322 0

GAAP Operating Income $106 $47 $40 $197 $145

53 Consolidated Segment Operating Income Reconciliation -- TTM ($MM)

Q1 06 Q2 06 Q3 06 Q4 06 Q1 07

Consolidated Segment Operating Income $558 $506 $457 $500 $560

Less:

Stock-Based Compensation 79 84 87 101 124

Other Operating Expense (Income) 4950 13 10 7

GAAP Operating Income $430 $372 $357 $389 $429

54 Consolidated Segment Operating Income Reconciliation -- TTM ($MM)

2002 2003 2004 2005 2006

Consolidated Segment Operating Income $180 $361 $490 $566 $500

Less:

Stock-Based Compensation 69 88 58 87 101

Other Operating Expense (Income) 473 (8) 47 10

GAAP Operating Income $64 $270 $440 $432 $389

55