AMAZON COM INC | 2013 | FY | 3


SEGMENT INFORMATION
We have organized our operations into two segments: North America and International. We present our segment information along the same lines that our Chief Executive Officer reviews our operating results in assessing performance and allocating resources.
We allocate to segment results the operating expenses “Fulfillment,” “Marketing,” “Technology and content,” and “General and administrative,” but exclude from our allocations the portions of these expense lines attributable to stock-based compensation. We do not allocate the line item “Other operating expense (income), net” to our segment operating results. A majority of our costs for “Technology and content” are incurred in the U.S. and most of these costs are allocated to our North America segment. There are no internal revenue transactions between our reporting segments.
North America
The North America segment consists of amounts earned from retail sales of consumer products (including from sellers) and subscriptions through North America-focused websites such as www.amazon.com and www.amazon.ca and include amounts earned from AWS. This segment includes export sales from www.amazon.com and www.amazon.ca.
International
The International segment consists of amounts earned from retail sales of consumer products (including from sellers) and subscriptions through internationally-focused websites. This segment includes export sales from these internationally based websites (including export sales from these sites to customers in the U.S. and Canada), but excludes export sales from our U.S. and Canadian websites.

Information on reportable segments and reconciliation to consolidated net income (loss) is as follows (in millions):
  
Year Ended December 31,
 
2013
 
2012
 
2011
North America
 
 
 
 
 
Net sales
$
44,517

 
$
34,813

 
$
26,705

Segment operating expenses (1)
42,631

 
33,221

 
25,772

Segment operating income
$
1,886

 
$
1,592

 
$
933

International
 
 
 
 
 
Net sales
$
29,935

 
$
26,280

 
$
21,372

Segment operating expenses (1)
29,828

 
26,204

 
20,732

Segment operating income
$
107

 
$
76

 
$
640

Consolidated
 
 
 
 
 
Net sales
$
74,452

 
$
61,093

 
$
48,077

Segment operating expenses (1)
72,459

 
59,425

 
46,504

Segment operating income
1,993

 
1,668

 
1,573

Stock-based compensation
(1,134
)
 
(833
)
 
(557
)
Other operating income (expense), net
(114
)
 
(159
)
 
(154
)
Income from operations
745

 
676

 
862

Total non-operating income (expense)
(239
)
 
(132
)
 
72

Provision for income taxes
(161
)
 
(428
)
 
(291
)
Equity-method investment activity, net of tax
(71
)
 
(155
)
 
(12
)
Net income (loss)
$
274

 
$
(39
)
 
$
631

___________________
(1)
Represents operating expenses, excluding stock-based compensation and “Other operating expense (income), net,” which are not allocated to segments.
Net sales of similar products and services were as follows (in millions):
  
Year Ended December 31,
 
2013
 
2012
 
2011
Net Sales:
 
Media
$
21,716

 
$
19,942

 
$
17,779

Electronics and other general merchandise
48,802

 
38,628

 
28,712

Other (1)
3,934

 
2,523

 
1,586

 
$
74,452

 
$
61,093

 
$
48,077

___________________
(1)
Includes sales from non-retail activities, such as AWS, advertising services, and our co-branded credit card agreements.

Net sales generated from these internationally-focused websites are denominated in local functional currencies. Revenues are translated at average rates prevailing throughout the period. Net sales attributed to foreign countries are as follows (in millions):
 
 
Year Ended December 31,
 
2013
 
2012
 
2011
Germany
$
10,535

 
$
8,732

 
$
7,230

Japan
7,639

 
7,800

 
6,576

United Kingdom
7,291

 
6,478

 
5,348


Total assets, property and equipment, net, and total property and equipment additions, by geography, reconciled to consolidated amounts are (in millions):
 
 
December 31,
 
2013
 
2012
North America
 
 
 
Total assets
$
26,108

 
$
20,703

Property and equipment, net
8,447

 
5,481

Total property and equipment additions
4,837

 
3,348

International
 
 
 
Total assets
$
14,051

 
$
11,852

Property and equipment, net
2,502

 
1,579

Total property and equipment additions
1,536

 
969

Consolidated
 
 
 
Total assets
$
40,159

 
$
32,555

Property and equipment, net
10,949

 
7,060

Total property and equipment additions
6,373

 
4,317


Except for the U.S., property and equipment, net, in any single country was less than 10% of consolidated property and equipment, net.
Depreciation expense, by segment, is as follows (in millions):
 
 
Year Ended December 31,
 
2013
 
2012
 
2011
North America
$
1,863

 
$
1,229

 
$
795

International
597

 
424

 
239

Consolidated
$
2,460

 
$
1,653

 
$
1,034


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