Decomposing ROE involves expressing net income divided by shareholders’ equity as the product of component ratios.

Amazon.com Inc., decomposition of ROE (quarterly data)

	ROE	=	ROA	×	Leverage

Jun 30, 2019	22.80%	=	6.32%	×	3.61
Mar 31, 2019	24.80%	=	6.74%	×	3.68
Dec 31, 2018	23.13%	=	6.19%	×	3.73
Sep 30, 2018	22.75%	=	6.20%	×	3.67
Jun 30, 2018	17.93%	=	4.68%	×	3.83
Mar 31, 2018	12.52%	=	3.12%	×	4.02
Dec 31, 2017	10.95%	=	2.31%	×	4.74
Sep 30, 2017	7.81%	=	1.67%	×	4.67
Jun 30, 2017	8.28%	=	2.19%	×	3.78
Mar 31, 2017	11.91%	=	3.19%	×	3.74
Dec 31, 2016	12.29%	=	2.84%	×	4.32
Sep 30, 2016	11.83%	=	2.97%	×	3.99
Jun 30, 2016	11.68%	=	2.97%	×	3.93
Mar 31, 2016	7.90%	=	1.91%	×	4.14
Dec 31, 2015	4.45%	=	0.91%	×	4.89
Sep 30, 2015	2.64%	=	0.58%	×	4.52
Jun 30, 2015	-1.60%	=	-0.36%	×	4.46
Mar 31, 2015	-3.73%	=	-0.81%	×	4.61
Dec 31, 2014	-2.24%	=	-0.44%	×	5.07
Sep 30, 2014	—	=	—	×	3.91
Jun 30, 2014	—	=	—	×	3.57
Mar 31, 2014	—	=	—	×	3.52

The primary reason for the decrease in Return on Equity (ROE) over Q2 2019 is the decrease in profitability measured by Return on Assets (ROA).

Amazon.com Inc., decomposition of ROE (quarterly data)

	ROE	=	Net Profit Margin	×	Asset Turnover	×	Leverage

Jun 30, 2019	22.80%	=	4.80%	×	1.32	×	3.61
Mar 31, 2019	24.80%	=	4.97%	×	1.36	×	3.68
Dec 31, 2018	23.13%	=	4.33%	×	1.43	×	3.73
Sep 30, 2018	22.75%	=	4.03%	×	1.54	×	3.67
Jun 30, 2018	17.93%	=	3.02%	×	1.55	×	3.83
Mar 31, 2018	12.52%	=	2.04%	×	1.53	×	4.02
Dec 31, 2017	10.95%	=	1.71%	×	1.35	×	4.74
Sep 30, 2017	7.81%	=	1.20%	×	1.40	×	4.67
Jun 30, 2017	8.28%	=	1.28%	×	1.71	×	3.78
Mar 31, 2017	11.91%	=	1.81%	×	1.76	×	3.74
Dec 31, 2016	12.29%	=	1.74%	×	1.63	×	4.32
Sep 30, 2016	11.83%	=	1.64%	×	1.81	×	3.99
Jun 30, 2016	11.68%	=	1.60%	×	1.85	×	3.93
Mar 31, 2016	7.90%	=	1.03%	×	1.86	×	4.14
Dec 31, 2015	4.45%	=	0.56%	×	1.64	×	4.89
Sep 30, 2015	2.64%	=	0.33%	×	1.79	×	4.52
Jun 30, 2015	-1.60%	=	-0.20%	×	1.83	×	4.46
Mar 31, 2015	-3.73%	=	-0.44%	×	1.84	×	4.61
Dec 31, 2014	-2.24%	=	-0.27%	×	1.63	×	5.07
Sep 30, 2014	—	=	—	×	—	×	3.91
Jun 30, 2014	—	=	—	×	—	×	3.57
Mar 31, 2014	—	=	—	×	—	×	3.52

The primary reason for the decrease in Return on Equity (ROE) over Q2 2019 is the decrease in profitability measured by Net Profit Margin.

Amazon.com Inc., decomposition of ROE (quarterly data)

	ROE	=	Tax Burden	×	Interest Burden	×	EBIT Margin	×	Asset Turnover	×	Leverage

Jun 30, 2019	22.80%	=	0.86	×	0.90	×	6.16%	×	1.32	×	3.61
Mar 31, 2019	24.80%	=	0.87	×	0.90	×	6.29%	×	1.36	×	3.68
Dec 31, 2018	23.13%	=	0.89	×	0.89	×	5.45%	×	1.43	×	3.73
Sep 30, 2018	22.75%	=	0.91	×	0.88	×	5.05%	×	1.54	×	3.67
Jun 30, 2018	17.93%	=	0.94	×	0.84	×	3.82%	×	1.55	×	3.83
Mar 31, 2018	12.52%	=	0.83	×	0.82	×	3.00%	×	1.53	×	4.02
Dec 31, 2017	10.95%	=	0.80	×	0.82	×	2.61%	×	1.35	×	4.74
Sep 30, 2017	7.81%	=	0.62	×	0.83	×	2.32%	×	1.40	×	4.67
Jun 30, 2017	8.28%	=	0.59	×	0.86	×	2.53%	×	1.71	×	3.78
Mar 31, 2017	11.91%	=	0.69	×	0.88	×	2.99%	×	1.76	×	3.74
Dec 31, 2016	12.29%	=	0.62	×	0.89	×	3.15%	×	1.63	×	4.32
Sep 30, 2016	11.83%	=	0.59	×	0.88	×	3.15%	×	1.81	×	3.99
Jun 30, 2016	11.68%	=	0.58	×	0.88	×	3.14%	×	1.85	×	3.93
Mar 31, 2016	7.90%	=	0.46	×	0.85	×	2.63%	×	1.86	×	4.14
Dec 31, 2015	4.45%	=	0.39	×	0.77	×	1.87%	×	1.64	×	4.89
Sep 30, 2015	2.64%	=	0.32	×	0.71	×	1.44%	×	1.79	×	4.52
Jun 30, 2015	-1.60%	=	-1.26	×	0.30	×	0.52%	×	1.83	×	4.46
Mar 31, 2015	-3.73%	=	—	×	-5.74	×	0.05%	×	1.84	×	4.61
Dec 31, 2014	-2.24%	=	—	×	-0.54	×	0.15%	×	1.63	×	5.07
Sep 30, 2014	—	=	—	×	—	×	—	×	—	×	3.91
Jun 30, 2014	—	=	—	×	—	×	—	×	—	×	3.57
Mar 31, 2014	—	=	—	×	—	×	—	×	—	×	3.52

The primary reason for the decrease in Return on Equity (ROE) over Q2 2019 is the decrease in efficiency measured by Asset Turnover.

Amazon.com Inc., decomposition of ROA (quarterly data)

	ROA	=	Net Profit Margin	×	Asset Turnover

Jun 30, 2019	6.32%	=	4.80%	×	1.32
Mar 31, 2019	6.74%	=	4.97%	×	1.36
Dec 31, 2018	6.19%	=	4.33%	×	1.43
Sep 30, 2018	6.20%	=	4.03%	×	1.54
Jun 30, 2018	4.68%	=	3.02%	×	1.55
Mar 31, 2018	3.12%	=	2.04%	×	1.53
Dec 31, 2017	2.31%	=	1.71%	×	1.35
Sep 30, 2017	1.67%	=	1.20%	×	1.40
Jun 30, 2017	2.19%	=	1.28%	×	1.71
Mar 31, 2017	3.19%	=	1.81%	×	1.76
Dec 31, 2016	2.84%	=	1.74%	×	1.63
Sep 30, 2016	2.97%	=	1.64%	×	1.81
Jun 30, 2016	2.97%	=	1.60%	×	1.85
Mar 31, 2016	1.91%	=	1.03%	×	1.86
Dec 31, 2015	0.91%	=	0.56%	×	1.64
Sep 30, 2015	0.58%	=	0.33%	×	1.79
Jun 30, 2015	-0.36%	=	-0.20%	×	1.83
Mar 31, 2015	-0.81%	=	-0.44%	×	1.84
Dec 31, 2014	-0.44%	=	-0.27%	×	1.63
Sep 30, 2014	—	=	—	×	—
Jun 30, 2014	—	=	—	×	—
Mar 31, 2014	—	=	—	×	—

The primary reason for the decrease in Return on Assets (ROA) over Q2 2019 is the decrease in profitability measured by Net Profit Margin.

Amazon.com Inc., decomposition of ROA (quarterly data)

	ROA	=	Tax Burden	×	Interest Burden	×	EBIT Margin	×	Asset Turnover

Jun 30, 2019	6.32%	=	0.86	×	0.90	×	6.16%	×	1.32
Mar 31, 2019	6.74%	=	0.87	×	0.90	×	6.29%	×	1.36
Dec 31, 2018	6.19%	=	0.89	×	0.89	×	5.45%	×	1.43
Sep 30, 2018	6.20%	=	0.91	×	0.88	×	5.05%	×	1.54
Jun 30, 2018	4.68%	=	0.94	×	0.84	×	3.82%	×	1.55
Mar 31, 2018	3.12%	=	0.83	×	0.82	×	3.00%	×	1.53
Dec 31, 2017	2.31%	=	0.80	×	0.82	×	2.61%	×	1.35
Sep 30, 2017	1.67%	=	0.62	×	0.83	×	2.32%	×	1.40
Jun 30, 2017	2.19%	=	0.59	×	0.86	×	2.53%	×	1.71
Mar 31, 2017	3.19%	=	0.69	×	0.88	×	2.99%	×	1.76
Dec 31, 2016	2.84%	=	0.62	×	0.89	×	3.15%	×	1.63
Sep 30, 2016	2.97%	=	0.59	×	0.88	×	3.15%	×	1.81
Jun 30, 2016	2.97%	=	0.58	×	0.88	×	3.14%	×	1.85
Mar 31, 2016	1.91%	=	0.46	×	0.85	×	2.63%	×	1.86
Dec 31, 2015	0.91%	=	0.39	×	0.77	×	1.87%	×	1.64
Sep 30, 2015	0.58%	=	0.32	×	0.71	×	1.44%	×	1.79
Jun 30, 2015	-0.36%	=	-1.26	×	0.30	×	0.52%	×	1.83
Mar 31, 2015	-0.81%	=	—	×	-5.74	×	0.05%	×	1.84
Dec 31, 2014	-0.44%	=	—	×	-0.54	×	0.15%	×	1.63
Sep 30, 2014	—	=	—	×	—	×	—	×	—
Jun 30, 2014	—	=	—	×	—	×	—	×	—
Mar 31, 2014	—	=	—	×	—	×	—	×	—

The primary reason for the decrease in Return on Assets (ROA) over Q2 2019 is the decrease in efficiency measured by Asset Turnover.

Amazon.com Inc., decomposition of Net Profit Margin (quarterly data)

	Net Profit Margin	=	Tax Burden	×	Interest Burden	×	EBIT Margin

Jun 30, 2019	4.80%	=	0.86	×	0.90	×	6.16%
Mar 31, 2019	4.97%	=	0.87	×	0.90	×	6.29%
Dec 31, 2018	4.33%	=	0.89	×	0.89	×	5.45%
Sep 30, 2018	4.03%	=	0.91	×	0.88	×	5.05%
Jun 30, 2018	3.02%	=	0.94	×	0.84	×	3.82%
Mar 31, 2018	2.04%	=	0.83	×	0.82	×	3.00%
Dec 31, 2017	1.71%	=	0.80	×	0.82	×	2.61%
Sep 30, 2017	1.20%	=	0.62	×	0.83	×	2.32%
Jun 30, 2017	1.28%	=	0.59	×	0.86	×	2.53%
Mar 31, 2017	1.81%	=	0.69	×	0.88	×	2.99%
Dec 31, 2016	1.74%	=	0.62	×	0.89	×	3.15%
Sep 30, 2016	1.64%	=	0.59	×	0.88	×	3.15%
Jun 30, 2016	1.60%	=	0.58	×	0.88	×	3.14%
Mar 31, 2016	1.03%	=	0.46	×	0.85	×	2.63%
Dec 31, 2015	0.56%	=	0.39	×	0.77	×	1.87%
Sep 30, 2015	0.33%	=	0.32	×	0.71	×	1.44%
Jun 30, 2015	-0.20%	=	-1.26	×	0.30	×	0.52%
Mar 31, 2015	-0.44%	=	—	×	-5.74	×	0.05%
Dec 31, 2014	-0.27%	=	—	×	-0.54	×	0.15%
Sep 30, 2014	—	=	—	×	—	×	—
Jun 30, 2014	—	=	—	×	—	×	—
Mar 31, 2014	—	=	—	×	—	×	—

The primary reason for the decrease in Net Profit Margin over Q2 2019 is the decrease in operating profitability measured by EBIT Margin.

Amazon.com Inc. (AMZN)

DuPont Analysis: Decomposition of ROE
Quarterly Data