Amazon’s annual financial report gives us an opportunity to review its top-line performance by geography. In this brief report, we look at Amazon’s revenue growth in the U.K. and Germany in 2018. We have converted the dollar-denominated figures reported by Amazon to British pounds and euros, respectively, to indicate growth in domestic currencies. In the absence of disclosure by Amazon on the exchange rates it used for its original conversion to U.S. dollars, we have used average annual exchange rates for our calculations. The UK In British pounds, Amazon grew its total U.K. revenues by 23.3% in 2018, broadly in line with the growth it saw in 2017, according to our calculations. This was well ahead of total U.K. Internet retail sales growth of 14.5%, according to our analysis of data from the Office for National Statistics (ONS). In 2018, Amazon reported U.K. revenues of $14.5 billion, or £10.9 billion at 2018 exchange rates. However, Amazon’s regional revenues incorporate nonretail revenues, including from subscription services to consumers, such as Amazon Prime, Amazon Music and Audible and its high-growth Amazon Web Services (AWS) cloud computing division.   [caption id="attachment_72052" align="aligncenter" width="640"] Amazon revenues converted to British pounds at average annual exchange rates
Source: Company reports/S&P Capital IQ/ONS/Coresight Research[/caption]   Euromonitor International estimates that Amazon captured a 31% share of total U.K. Internet retail sales in 2018, up from just under 30% in 2017. Euromonitor estimates that Amazon’s 2018 share was split 21% for sales by third-party merchants on Amazon and just 10% for first-party sales. However, Euromonitor’s data were compiled before Amazon reported full-year figures. Germany In Germany, Amazon saw growth slow meaningfully in 2018 with euro-denominated revenues climbing by 12.1% versus a 17.5% increase in 2017, according to our calculations. This was in the context of a slowdown in German Internet retail sales as consumer uncertainty triggered by Brexit, international disputes and rising inflation resulted in tepid demand for nonfood categories. As in the U.K., the company’s revenue growth outpaced total growth in Internet retail sales, as estimated by Euromonitor. In 2018, Amazon reported German revenues of $19.9 billion, or €16.9 billion, at 2018 exchange rates.   [caption id="attachment_72054" align="aligncenter" width="640"] Amazon revenues converted to euros at average annual exchange rates.
Source: Company reports/S&P Capital IQ/Euromonitor International/Coresight Research[/caption]   Euromonitor estimates that Amazon accounted for 47% of German Internet retail sales in 2018, up from around 46% in 2017. In 2018, Amazon’s first-party sales captured a little under 25% of Internet retail sales and third-party sales captured just under 23%, according to Euromonitor.