Seattle, WA…Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its third quarter ended September 30, 2016.

Operating cash flow increased 49% to $14.6 billion for the trailing twelve months, compared with $9.8 billion for the trailing twelve months ended September 30, 2015. Free cash flow increased to $8.6 billion for the trailing twelve months, compared with $5.4 billion for the trailing twelve months ended September 30, 2015. Free cash flow less lease principal repayments increased to $4.9 billion for the trailing twelve months, compared with $3.1 billion for the trailing twelve months ended September 30, 2015. Free cash flow less finance lease principal repayments and assets acquired under capital leases increased to $3.4 billion for the trailing twelve months, compared with $637 million for the trailing twelve months ended September 30, 2015.

Common shares outstanding plus shares underlying stock-based awards totaled 496 million on September 30, 2016, compared with 489 million one year ago.

Net sales increased 29% to $32.7 billion in the third quarter, compared with $25.4 billion in third quarter 2015. The favorable impact from year-over-year changes in foreign exchange rates throughout the quarter on net sales was $52 million.

Operating income was $575 million in the third quarter, compared with $406 million in third quarter 2015.

Net income was $252 million in the third quarter, or $0.52 per diluted share, compared with $79 million, or $0.17 per diluted share, in third quarter 2015.

“Alexa may be Amazon’s most loved invention yet — literally — with over 250,000 marriage proposals from customers and counting,” said Jeff Bezos, founder and CEO of Amazon. “And she’s just getting better. Because Alexa’s brain is in the cloud, we can easily and continuously add to her capabilities and make her more useful — wait until you see some of the surprises the team is working on now.”

Highlights

Amazon Studios announced a slate of new Original Movies and Series premiering in the coming months, including the theatrical debut of Manchester by the Sea, a Sundance and Toronto Film Festival favorite, as well as exclusive Prime Video premieres of Amazon Original Series including The Man in the High Castle, the second season of the most watched original series on Prime Video; The Grand Tour, the highly-anticipated series with Clarkson, Hammond, and May; and Mozart in the Jungle, the third season of the multi-Golden Globe winning series.
Amazon Studios released Gleason, The Dressmaker, The Handmaiden, and Author: The JT LeRoy Story in theaters nationwide. Each film will be available exclusively to Prime members through Prime Video following its theatrical release.
Amazon Video won six Emmys, including the second win for both Jeffrey Tambor and Jill Soloway for Outstanding Lead Actor in a Comedy Series and Outstanding Directing for a Comedy Series, respectively, for Transparent.
Amazon debuted five Amazon Original Series, including the third season of award-winning series Transparent, and the debut seasons of One Mississippi, Fleabag, Woody Allen’s first TV series, Crisis in Six Scenes, and David E. Kelley’s Goliath, starring Billy Bob Thornton.
Since launching in May, Amazon customers have streamed billions of minutes of content from providers that self-published through Amazon Video Direct.
Amazon launched Amazon Music Unlimited, an on-demand music streaming service with tens of millions of songs and thousands of curated playlists and personalized stations. Customers listening to Amazon Music Unlimited on Echo, Echo Dot, or Amazon Tap can access their favorite music with new natural language voice controls powered by Alexa. The on-demand music service is $7.99 per month for Prime members, and only $3.99 per month for customers who subscribe to the exclusive “for Echo” subscription plan.
Amazon announced that music from Garth Brooks — the #2 all-time best-selling artist in the U.S. behind only the Beatles — is now available to stream exclusively on Amazon Music. Fans can listen to hit songs and popular albums from the country music icon on Amazon Music Unlimited, with albums and songs also available for purchase and digital download on Amazon Music.
Amazon introduced the all-new version of the Echo Dot, a hands-free, voice-controlled device powered by Alexa — available in the U.S. for under $50. Additionally, Amazon introduced Alexa, Echo, and Echo Dot to customers in the U.K. and Germany.
Alexa skills selection increased 3x in three months, and there are now more than 3,000 skills available, including Food Network, GE Appliances, Yahoo Sports Fantasy Football, and more. Amazon now has tens of thousands of developers building new skills for Alexa.
Amazon announced the Alexa Prize, an annual university competition with $2.5 million dedicated to accelerating the field of conversational artificial intelligence. The goal of the competition is to build a “socialbot” on Alexa that will converse with people about popular topics and news events.
Amazon introduced Fire HD 8, an all-new tablet that offers 12 hours of battery life, 50% more RAM for faster performance, and 2x the storage — for $89.99. Amazon also announced that Alexa is coming to Fire tablets — just press and ask, and Alexa will play music, launch games, read audiobooks, and more.
Amazon introduced the next generation of the best-selling Fire TV Stick, now with an included Alexa Voice Remote, and still $39.99. Amazon also released a software update for Fire TV and Fire TV Stick that enables customers to use their voice to search across more than 90 apps and channels, including Netflix, making it easier to find and watch their favorite TV shows and movies without navigating through multiple apps.
Amazon Game Studios announced its first three games at TwitchCon 2016: Breakaway, New World, and Crucible. All three games are built on the Amazon Lumberyard game engine, and created for Twitch broadcasters, viewers, and players.
Amazon and Twitch announced Twitch Prime, a new set of Prime benefits for gamers that includes exclusive discounts on pre-order and new release games, a rotating selection of free digital games and in-game loot, and a premium Twitch experience that includes a monthly Twitch channel subscription.
Amazon introduced new features to the Prime Photos service in the U.S., designed for Prime members and their family. Prime members can now invite up to five family members or friends to join their Family Vault, which includes access to Prime Photos benefits including unlimited storage of photos, plus an additional 5 GB for videos and other files.
Amazon introduced Prime Reading, a benefit for Prime members to enjoy unlimited, free reading from a rotating selection of over a thousand books, magazines, comics, and more.
Amazon and Audible announced Audible Channels, a new benefit for Prime members to enjoy unlimited, free access to the new short-form digital audio service as well as access to a rotating selection from Audible’s audiobook catalog.
AmazonFresh expanded to northern Virginia, Dallas, Maryland, and Chicago. Additionally, customers in all locations can now shop for groceries through AmazonFresh directly on the Amazon.com website alongside their other shopping.
The Great Indian Festival was Amazon.in’s biggest shopping event ever. During the event, customers from 97% of India’s serviceable postal codes placed at least one order on Amazon.in.
Handmade at Amazon launched in the U.K., Germany, France, Italy, and Spain. Customers across Europe can now shop from more than 30,000 genuinely handcrafted items sold by thousands of artisans from over 40 countries.
Amazon Japan became the new title sponsor of Amazon Fashion Week Tokyo, collaborating with the Japan Fashion Week Organization to help support and elevate the awareness of Japanese fashion designers and manufacturers globally.
Amazon expects to create 120,000 seasonal jobs in customer fulfillment and customer service this holiday season. Last year, Amazon transitioned more than 14,000 seasonal positions to regular, full-time roles after the holidays, and expects to increase that number this year.
Amazon.co.uk announced the “Amazon Women in Innovation Bursary” at University of Cambridge, University of Edinburgh, and King’s College, which provides scholarships for young women to pursue a degree in innovation-related fields.
Amazon Web Services (AWS) announced the availability of the U.S. East (Ohio) Region. AWS now operates 38 Availability Zones across 14 technology infrastructure Regions globally, and plans to open an additional nine Availability Zones in four regions (Canada, the U.K., France, and a second region in China) in the coming months.
VMware and AWS announced a new hybrid cloud service, “VMware Cloud on AWS,” that enables customers to use their existing VMware software and tools to leverage AWS’s global footprint and breadth of services, including storage, databases, analytics, and more. This offering will be the primary public cloud service sold and supported by VMware, and AWS will be VMware’s primary public cloud partner.
AWS announced the availability of P2 instances, a new GPU instance type for Amazon EC2. The most powerful GPU virtual machine in the cloud with up to 16 NVIDIA Tesla® K80 GPUs, P2 instances are designed for compute-intensive applications such as artificial intelligence, deep learning, computational fluid dynamics, computational finance, seismic analysis, molecular modeling, genomics, and rendering workloads.
AWS announced the option for customers to bring their own encryption keys with AWS Key Management Service. This new feature allows customers to import keys from any key management and Hardware Security Module solution and use them with AWS services and their own applications.
AWS launched new capabilities for AWS Educate, a global program that provides students and educators with resources to accelerate cloud-related learning. The program now includes access to courses designed to teach cloud skills, paired with the AWS Educate Job Board, featuring cloud-related internships and jobs from top employers around the world.
AWS announced a new Application Load Balancer option for content-based routing that enables customers to route a request to an AWS service based on the content of the request and supports applications that run in containers. Web sites and mobile applications, running in containers or on Amazon EC2 instances, will benefit from the use of Application Load Balancers.