What changed in this filing

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Item 1. Financial Statements

2026-04-30 compared with 2025-10-31 · 196 added, 182 removed, 471 unchanged (45% of the section changed)

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Three Months Ended

September 30, Nine Months Ended

September 30, Twelve Months Ended

September 30,

March 31, Twelve Months Ended

2025 2026 2025 2026

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

Net product sales $ 63,970 $ 71,304

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Other income (expense), net 2,749 15,647

Total non-operating income (expense) 626 10,748 ( 1,125 ) 15,708

Total non-operating income 3,274 15,982

Income before income taxes 21,679 39,834

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

Net income $ 17,127 $ 30,255

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1,535 ( 764 )

Unrealized gains (losses) on net investment hedging instruments, net of tax of $ 0 and $ 24

Available-for-sale debt securities:

Change in net unrealized gains (losses), net of tax of $( 11 ) and $( 340 )

167 12,397 944 12,474

reclassification adjustment for losses (gains) included in “Other income (expense), net,” net of tax of $ 0 , $ 512 , $( 1 ), and $ 1,326

reclassification adjustments for net losses (gains) included in “Other income (expense), net,” net of tax of $ 809 and $ 1,142

( 2,454 ) ( 3,337 )

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Other, net of tax of $ 1 and $( 2 )

( 3 ) 1 ( 4 ) —

Total other comprehensive income (loss) ( 880 ) ( 3,362 )

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(in millions, except per share data)

December 31, 2024 September 30, 2025

December 31, 2025 March 31, 2026

Current assets:

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The consolidated financial statements include the accounts of Amazon.com, Inc.

and its consolidated entities (collectively, the “Company”), consisting of its wholly-owned subsidiaries and those entities in which we have a variable interest and of which we are the primary beneficiary, including certain entities in India and certain entities that support our healthcare services and production and distribution of video content.

and its consolidated entities (collectively, the “Company”), consisting of its wholly-owned subsidiaries and those entities in which we have a variable interest (“VIEs”) and of which we are the primary beneficiary, including certain entities in India and certain entities that support our healthcare services and production and distribution of video content.

We are the primary beneficiary if we have the power to direct the activities of the VIE and absorb the losses or benefits that would be significant to the VIE.

Intercompany balances and transactions between consolidated entities are eliminated.

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The preparation of financial statements in conformity with GAAP requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent liabilities in the consolidated financial statements and accompanying notes.

Estimates are used for, but not limited to, income taxes, useful lives of equipment, commitments and contingencies, valuation of acquired intangibles and goodwill, stock-based compensation forfeiture rates, vendor funding, inventory valuation, collectability of receivables, impairment of property and equipment and operating leases, valuation and impairment of investments, self-insurance liabilities, viewing patterns of capitalized video content, valuation of derivative instruments, and the determination of when to capitalize certain costs relating to new products or service offerings.

Estimates are used for, but not limited to, collectability of receivables, commitments and contingencies, impairment of property and equipment and operating leases, income taxes, inventory valuation, self-insurance liabilities, stock-based compensation forfeiture rates, the determination of when to capitalize certain costs relating to new products or service offerings, useful lives of equipment, valuation and impairment of investments, valuation of acquired intangibles and goodwill, valuation of derivative instruments, vendor funding, and viewing patterns of capitalized video content.

Actual results could differ materially from these estimates.

We review the useful lives of equipment on an ongoing basis.

Effective January 1, 2025 we changed our estimate of the useful lives of a subset of our servers and networking equipment from six years to five years .

The shorter useful lives are due to the increased pace of technology development, particularly in the area of artificial intelligence and machine learning.

The effect of this change in estimate for Q3 2025, based on servers and networking equipment that were included in “Property and equipment, net” as of June 30, 2025 and those acquired during the three months ended September 30, 2025, was an increase in depreciation and amortization expense of $ 392 million and a reduction in net income of $ 298 million, or $ 0.03 per basic share and $ 0.03 per diluted share, which primarily impacted our AWS segment.

The effect of this change in estimate for the nine months ended September 30, 2025, based on servers and networking equipment that were included in “Property and equipment, net” as of December 31, 2024 and those acquired during the nine months ended September 30, 2025, was an increase in depreciation and amortization expense of $ 889 million and a reduction in net income of $ 677 million, or $ 0.06 per basic share and $ 0.06 per diluted share, which primarily impacted our AWS segment.

During Q3 2025, we recorded $ 2.5 billion of expense related to the settlement of a lawsuit with the Federal Trade Commission (FTC).

This charge was recorded in “Other operating expense (income), net” and impacted our North America segment.

For the three and nine months ended September 30, 2025, we recorded approximately $ 1.8 billion and $ 2.0 billion of estimated severance costs primarily related to planned role eliminations.

These charges increased our payroll and related expenses and were recorded primarily in “Technology and infrastructure,” “Sales and marketing,” and “General and administrative” and impacted all of our segments.

Supplemental Cash Flow Information

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Three Months Ended

September 30, Nine Months Ended

September 30, Twelve Months Ended

September 30,

March 31, Twelve Months Ended

2025 2026 2025 2026

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

Shares used in computation of basic earnings per share 10,603 10,743

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

Marketable equity securities valuation gains (losses) $ ( 117 ) $ 220 $ ( 1,800 ) $ 470

Equity warrant valuation gains (losses) 80 441 ( 421 ) 653

Reclassification adjustments for gains (losses) on available-for-sale debt securities — 2,307 ( 5 ) 5,592

Marketable equity securities valuation gains (losses), net $ ( 138 ) $ ( 889 )

Equity warrant valuation gains (losses), net ( 378 ) ( 398 )

Reclassification adjustments for gains (losses) on available-for-sale debt securities, net 3,263 4,479

Upward adjustments relating to equity investments in private companies 37 12,328

Foreign currency gains (losses) 17 1 ( 195 ) 69

Foreign currency gains (losses), net ( 2 ) 160

Other, net ( 33 ) ( 33 )

Total other income (expense), net $ 2,749 $ 15,647

The marketable equity securities valuation gain (loss) of $( 117 ) million and $ 220 million in Q3 2024 and Q3 2025, and $( 1.8 ) billion and $ 470 million for the nine months ended September 30, 2024 and 2025 is primarily from our equity investment in Rivian Automotive, Inc.

The reclassification adjustments for the gains on available-for-sale debt securities of $ 2.3 billion in Q3 2025 and $ 5.6 billion for the nine months ended September 30, 2025 is primarily from the portions of our convertible notes investments in Anthropic, PBC (“Anthropic”) that were converted to nonvoting preferred stock during Q3 2025 and the nine months ended September 30, 2025.

The upward adjustments relating to equity investments in private companies of $ 7.2 billion in Q3 2025 and $ 7.3 billion for the nine months ended September 30, 2025 reflect observable changes in prices, primarily from our nonvoting preferred stock in Anthropic.

The reclassification adjustments for the gains on available-for-sale debt securities of $ 3.3 billion and $ 4.5 billion in Q1 2025 and Q1 2026 are primarily from the portions of our convertible notes investments in Anthropic, PBC (“Anthropic”) that were converted to nonvoting preferred stock during Q1 2025 and Q1 2026.

The upward adjustments relating to equity investments in private companies of $ 12.3 billion in Q1 2026 reflect observable changes in prices, primarily from our nonvoting preferred stock in Anthropic.

Derivatives and Hedging

Energy Contracts — We enter into energy contracts to secure electricity supply for our existing and future operations, some of which extend 20 years.

We may make or receive net cash payments, rather than take delivery of electricity, when our consumption is less than committed quantities due to operational variability.

Because we may make or receive net cash payments, these contracts are derivative instruments.

These contracts are not traded on exchanges or transacted in secondary markets and are not used for trading or speculative purposes.

Derivative instruments are measured at fair value each reporting period.

Fair value measurements are based on valuation methods using both common factors like electricity futures prices where there are more liquid trading volumes generally for remaining contractual periods up to four to six years , forward capacity auctions, and risk-free interest rates, and a number of management assumptions for remaining contractual periods greater than four to six years where there is significantly less or no trading data such as long-dated forward commodity prices and implied volatility curves, and credit adjustments.

The extent of management judgment is significant (Level 3).

Fair value measurements will not impact cash flows but may be material to our statements of operations and balance sheet due to the duration of these contracts and volatility inherent in valuation methods.

Generally, we can terminate our contracts by paying cash in the form of fixed penalties, such as reimbursing the counterparty for the costs of new construction incurred.

Termination penalties are generally not based on fair value measurements.

As of March 31, 2026, the energy contract quantities subject to derivative accounting fair value measurements were approximately 200 million megawatt-hours and the weighted-average remaining duration of these contracts is approximately 15 years, with the majority of these megawatt-hours to be delivered beyond the next nine years .

The impact of these fair value measurements on our consolidated statement of operations in Q1 2025 and Q1 2026 was not significant.

Changes in fair value measurements will create unrealized gains and losses recorded within operating expenses on our statements of operations with corresponding assets (unrealized gains) and liabilities (unrealized losses) recorded on our balance sheet.

Certain of our energy contracts are subject to regulatory approval and are exempt from derivative guidance until the approval is obtained.

If possible, we may elect the normal purchases and normal sales (NPNS) scope exemption from derivative guidance for energy contracts where we expect to consume substantially all committed quantities.

A contract that no longer meets the NPNS exemption must be measured at fair value with immediate recognition in our financial statements.

Net Investment Hedges — Our March 2026 Euro-denominated Notes issuance of € 14.5 billion creates an exposure to changes in foreign exchange rates.

We designated these notes as net investment hedges to mitigate foreign currency exposures related to the translation of our investments in foreign operations to U.S.

Foreign currency unrealized gains and losses on these notes are included in “Accumulated other comprehensive income (loss),” a separate component of stockholders’ equity, until the foreign operations are sold or substantially liquidated, at which point these amounts and any translation adjustment of the foreign operations are reclassified to our consolidated statements of operations.

Inventories, consisting of products available for sale, are primarily accounted for using the first-in, first-out method, and are valued at the lower of cost and net realizable value.

This valuation requires us to make judgments, based on currently available information, about the likely method of disposition, such as through sales to individual customers, returns to product vendors, or liquidations, and expected recoverable values of each disposition category.

The inventory valuation allowance, representing a write-down of inventory, was $ 3.0 billion and $ 2.9 billion as of December 31, 2024 and September 30, 2025.

The inventory valuation allowance, representing a write-down of inventory, was $ 3.3 billion and $ 2.8 billion as of December 31, 2025 and March 31, 2026.

Accounts Receivable, Net and Other

Included in “Accounts receivable, net and other” on our consolidated balance sheets are receivables primarily related to customers, vendors, and prepaid expenses and other current assets.

As of December 31, 2024 and September 30, 2025, customer receivables, net, were $ 34.3 billion and $ 38.0 billion, vendor receivables, net, were $ 11.6 billion and $ 12.5 billion, and other receivables, net, were $ 3.4 billion and $ 3.8 billion.

Prepaid expenses and other current assets, which include amounts related to non-income taxes and satellite network launch services deposits, were $ 6.3 billion and $ 6.8 billion as of December 31, 2024 and September 30, 2025.

As of December 31, 2025 and March 31, 2026, customer receivables, net, were $ 40.4 billion and $ 43.3 billion, vendor receivables, net, were $ 15.9 billion and $ 16.4 billion, and other receivables, net, were $ 4.5 billion and $ 8.6 billion.

Prepaid expenses and other current assets, which include amounts related to satellite network launch services deposits, were $ 6.9 billion and $ 7.2 billion as of December 31, 2025 and March 31, 2026.

We currently expense satellite network launch services deposits upon launch to “Technology and infrastructure.”

We estimate losses on receivables based on expected losses, including our historical experience of actual losses.

The allowance for doubtful accounts was $ 2.0 billion and $ 2.3 billion as of December 31, 2024 and September 30, 2025.

The allowance for doubtful accounts was $ 2.4 billion and $ 2.6 billion as of December 31, 2025 and March 31, 2026.

Digital Video and Music Content

Included in “Other assets” on our consolidated balance sheets are the total capitalized costs of video, which is primarily released content, and music, which as of December 31, 2024 and September 30, 2025 were $ 19.6 billion and $ 21.5 billion.

Total video and music expense was $ 5.0 billion and $ 5.5 billion in Q3 2024 and Q3 2025, and $ 14.2 billion and $ 15.7 billion for the nine months ended September 30, 2024 and 2025.

Included in “Other assets” on our consolidated balance sheets are the total capitalized costs of video, which is primarily released content, and music, which as of December 31, 2025 and March 31, 2026 were $ 21.3 billion and $ 21.5 billion.

Total video and music expense was $ 5.1 billion and $ 6.0 billion in Q1 2025 and Q1 2026.

Unearned Revenue

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Unearned revenue primarily relates to prepayments of AWS services and Amazon Prime memberships.

Our total unearned revenue as of December 31, 2024 was $ 24.6 billion, of which $ 15.0 billion was recognized as revenue during the nine months ended September 30, 2025.

Included in “Other long-term liabilities” on our consolidated balance sheets was $ 6.5 billion and $ 4.1 billion of unearned revenue as of December 31, 2024 and September 30, 2025.

Additionally, we have performance obligations, primarily related to AWS, associated with commitments in customer contracts for future services that have not yet been recognized in our consolidated financial statements.

For contracts with original terms that exceed one year, those commitments not yet recognized were approximately $ 200 billion as of September 30, 2025.

Our total unearned revenue as of December 31, 2025 was $ 25.0 billion, of which $ 9.4 billion was recognized as revenue during the three months ended March 31, 2026.

Included in “Other long-term liabilities” on our consolidated balance sheets was $ 4.4 billion of unearned revenue as of December 31, 2025 and March 31, 2026.

Additionally, we have performance obligations, primarily related to AWS, associated with commitments in customer contracts for future services that we expect to fulfill but have not yet been recognized in our financial statements.

For contracts with original terms that exceed one year, those commitments not yet recognized were approximately $ 364 billion as of March 31, 2026.

The weighted-average remaining life of our long-term contracts is 5.5 years.

However, the amount and timing of revenue recognition is largely driven by customer usage, which can extend beyond the original contractual term.

The amount and timing of revenue recognition will be driven by customer usage and our performance in accordance with contractual obligations, which can extend beyond the original contractual duration and commitment.

In Q1 2026, AWS and OpenAI Group PBC (“OpenAI”) announced an expansion of the existing $ 38.0 billion multi-year commitment and commercial arrangement with OpenAI by $ 100.0 billion over 8.0 years, which includes contractual obligations related to the performance of AWS chips.

Accounting Pronouncements Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) amending existing income tax disclosure guidance, primarily requiring more detailed disclosure for income taxes paid and the effective tax rate reconciliation.

The ASU is effective for annual reporting periods beginning after December 15, 2024, with early adoption permitted and can be applied on either a prospective or retroactive basis.

We expect to adopt the ASU on a retroactive basis.

In November 2024, the FASB issued an ASU amending existing income statement disclosure guidance, primarily requiring more detailed disclosure for expenses.

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Cash, Cash Equivalents, Restricted Cash, and Marketable Securities

As of December 31, 2024 and September 30, 2025, our cash, cash equivalents, restricted cash, and marketable securities primarily consisted of cash, AAA-rated money market funds, U.S.

and foreign government and agency securities, other investment grade securities, and marketable equity securities.

As of December 31, 2025 and March 31, 2026, our cash, cash equivalents, restricted cash, and marketable securities primarily consisted of cash, AAA-rated money market funds, U.S.

government and agency securities, other investment grade securities, and marketable equity securities.

Cash equivalents and marketable securities are recorded at fair value.

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Other marketable securities were valued either based on recent trades of securities in inactive markets or based on quoted market prices of similar instruments and other significant inputs derived from or corroborated by observable market data.

The following table summarizes, by major security type, our cash, cash equivalents, restricted cash, and marketable securities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in millions):

December 31, 2024 September 30, 2025

The following table summarizes, by major investment type, our cash, cash equivalents, restricted cash, and marketable securities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in millions):

December 31, 2025 March 31, 2026

Fair Value Cost or

Cash $ 17,055 $ 15,977 $ — $ — $ 15,977

Level 1 securities:

Cash and time deposits $ 16,145 $ 14,655 $ — $ — $ 14,655

Money market funds 29,777 35,697 — — 35,697

Equity securities (1) 3,687 2,801

Level 2 securities:

Foreign government and agency securities 177 74 — — 74

government and agency securities 5,222 4,601 2 ( 18 ) 4,585

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Asset-backed securities 1,780 1,711 3 ( 11 ) 1,703

Other debt securities 67 28 — — 28

Other financial instruments 129 29 — — 29

$ 126,325 $ 143,204 $ 18 $ ( 58 ) $ 145,965

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___________________

(1) The related unrealized gain (loss) recorded in “Other income (expense), net” was $( 145 ) million and $ 153 million in Q3 2024 and Q3 2025, and $( 1.8 ) billion and $ 341 million for the nine months ended September 30, 2024 and 2025.

(1) The related unrealized gain (loss) recorded in “Other income (expense), net” was $( 205 ) million and $( 883 ) million in Q1 2025 and Q1 2026.

(2) We are required to pledge or otherwise restrict a portion of our cash, cash equivalents, and marketable debt securities primarily as collateral for real estate, amounts due to third-party sellers in certain jurisdictions, debt, standby and trade letters of credit, and licenses of digital media content.

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See “Note 4 — Commitments and Contingencies.”

The following table summarizes the remaining contractual maturities of our cash equivalents and marketable debt securities as of September 30, 2025 (in millions):

The following table summarizes the remaining contractual maturities of our cash equivalents and marketable debt securities as of March 31, 2026 (in millions):

Cost Estimated

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Non-Marketable Investments

From Q3 2023 to Q4 2024, we invested $ 5.3 billion in convertible notes from Anthropic, which are classified as available-for-sale and reported at fair value with unrealized gains and losses included in “Accumulated other comprehensive income (loss)” and as Level 3 assets, and as of December 31, 2024 had an estimated fair value of approximately $ 13.8 billion.

Anthropic — From Q3 2023 to Q4 2025, we invested $ 8.0 billion in convertible notes from Anthropic, which are classified as available-for-sale and reported at fair value with unrealized gains and losses included in “Accumulated other comprehensive income (loss)” and as Level 3 assets.

In making these estimates, we utilized valuation methods based on information available, including the rights and obligations of the convertible notes, other outstanding classes of securities, observable transactions such as new securities offerings, estimates of expected time to and type of liquidity events and anticipated securities offerings, and discounts for lack of marketability.

Some of these notes converted to nonvoting preferred stock in Q1 2025.

As a result of conversions, a significant portion of the unrealized gain associated with the notes as of December 31, 2024 was reclassified and a gain of approximately $ 3.3 billion was recorded in “Other income (expense), net” in our consolidated statement of operations.

The investment in nonvoting preferred stock was initially recorded at its estimated fair value at the time of the conversion and will be accounted for as a component of our equity investments in private companies not accounted for under the equity-method, with future adjustments for observable changes in prices or impairments representing Level 3 fair value measurements recognized in “Other income

(expense), net” on our consolidated statements of operations.

In Q2 2025, we invested $ 1.3 billion in a new convertible note from Anthropic, and will invest an additional $ 1.4 billion in Q4 2025.

In Q3 2025, an additional portion of our notes was converted to nonvoting preferred stock, and as a result of the conversion a portion of the unrealized gain associated with the notes was reclassified and a gain of approximately $ 2.3 billion was recorded in “Other income (expense), net.” We also recorded an upward adjustment of $ 7.2 billion to our nonvoting preferred stock in “Other income (expense), net” to reflect observable changes in price.

As of September 30, 2025, the amount recorded on our consolidated balance sheet for nonvoting preferred stock was approximately $ 14.8 billion.

As of September 30, 2025, the estimated fair value of our convertible notes recorded on our consolidated balance sheet was approximately $ 23.7 billion, and the associated unrealized gain included in “Accumulated other comprehensive income (loss)” was $ 18.8 billion.

In Q1 2025 and Q1 2026, a portion of the then-outstanding notes was converted to nonvoting preferred stock.

The investments in nonvoting preferred stock are initially recorded at their estimated fair value at the time of each conversion and are accounted for as a component of our equity investments in private companies not accounted for under the equity-method, with future adjustments for observable changes in prices or impairments representing Level 3 fair value measurements recognized in “Other income (expense), net” on our consolidated statements of operations.

As a result of these conversions, a portion of the unrealized gain associated with the notes included in “Accumulated other comprehensive income (loss)” was

reclassified and a gain of approximately $ 3.3 billion and $ 4.5 billion was recorded in “Other income (expense), net.” In Q1 2026, we also recorded an upward adjustment of approximately $ 12.3 billion to our nonvoting preferred stock in “Other income (expense), net” to reflect observable changes in price.

As of December 31, 2025 and March 31, 2026, the amounts recorded on our consolidated balance sheets for nonvoting preferred stock were approximately $ 14.8 billion and $ 32.0 billion.

As of December 31, 2025 and March 31, 2026, the estimated fair value of our convertible notes recorded on our consolidated balance sheets was approximately $ 45.8 billion and $ 42.2 billion, and the associated unrealized gain included in “Accumulated other comprehensive income (loss)” was $ 39.5 billion and $ 36.3 billion.

We also have a commercial arrangement primarily for the provision of AWS cloud services, which includes the use of AWS chips.

As of December 31, 2024 and September 30, 2025, equity investments in private companies not accounted for under the equity-method, which primarily relate to nonvoting preferred stock in Anthropic, had a carrying value of $ 989 million and $ 16.0 billion, with adjustments for observable changes in prices or impairments representing Level 3 fair value measurements recognized in “Other income (expense), net” on our consolidated statements of operations.

As of December 31, 2024 and September 30, 2025, equity investments accounted for under the equity-method of accounting, including investments for which we have elected the fair value option, had a carrying value of $ 1.2 billion and $ 1.1 billion.

Subsequent to March 31, 2026, we invested $ 5.0 billion in Anthropic nonvoting preferred stock.

Additionally, we amended our commercial arrangement which is primarily for the provision of AWS cloud services and includes contractual obligations related to the performance of AWS chips.

Furthermore, we entered into a financing arrangement to make available to Anthropic an aggregate facility not to exceed $ 20.0 billion that will expire 30 months after a liquidity event, as defined, such as an Anthropic initial public offering or direct listing of equity securities.

At inception, there is no amount available to be drawn against and as we reach certain delivery milestones of compute capacity under the amended commercial arrangement, amounts under this facility are made available for Anthropic to draw upon at its discretion.

Draws against the facility will be in the form of new Anthropic convertible notes or, after a liquidity event, Anthropic common stock, which will be issued to us in exchange for cash.

We also have an option to invest up to $ 5.0 billion in Anthropic’s future equity financings which if elected would reduce the amount available under the facility by the amount exercised under the option.

OpenAI — In Q1 2026, we invested $ 15.0 billion in Series C Preferred Stock of OpenAI, and we also entered into an equity commitment letter agreement (the “Letter Agreement”), pursuant to which we agreed to purchase additional shares of Series C Preferred Stock (the “Commitment Shares”) with an aggregate purchase price of $ 35.0 billion (the “Commitment Amount”).

We may, in our sole discretion, elect to purchase all or any portion of the Commitment Shares at any time pursuant to the Letter Agreement.

To the extent that we have not done so previously, we are obligated to purchase all remaining Commitment Shares upon the earlier to occur of (i) OpenAI meeting specified milestones, and (ii) OpenAI directly or indirectly consummating an initial public offering or direct listing of equity securities in the United States (a “Public Listing Transaction”), in each case subject to certain terms and conditions.

If certain conditions are not satisfied until after a Public Listing Transaction occurs, then our purchase commitment will relate to the class of OpenAI’s common stock that is publicly traded at the same effective price per share as the Series C Preferred Stock price.

The parties’ obligations under the Letter Agreement will terminate if we have not invested the Commitment Amount by December 31, 2028, which date may accelerate under certain circumstances.

We account for our investment in Series C Preferred Stock and purchase commitment as a component of our equity investments in private companies not accounted for under the equity-method, with future adjustments for observable changes in prices or impairments representing Level 3 fair value measurements recognized in “Other income (expense), net” on our consolidated statements of operations.

Additionally, in Q1 2026, we and an affiliate of OpenAI entered into (i) a commercial arrangement primarily for the provision of AWS cloud services, which includes the use of AWS chips, and (ii) a joint collaboration agreement pursuant to which certain services using OpenAI models will be made available to the Company and on AWS.

As of December 31, 2025 and March 31, 2026, equity investments in private companies not accounted for under the equity-method, which primarily relate to nonvoting preferred stock in Anthropic and preferred stock in OpenAI, had a carrying value of $ 16.2 billion and $ 48.1 billion, with adjustments for observable changes in prices or impairments representing Level 3 fair value measurements recognized in “Other income (expense), net” on our consolidated statements of operations.

As of December 31, 2025 and March 31, 2026, equity investments accounted for under the equity-method of accounting, including investments for which we have elected the fair value option, had a carrying value of $ 659 million and $ 923 million.

We hold equity warrants giving us the right to acquire stock of other companies.

As of December 31, 2024 and September 30, 2025, these warrants had a fair value of $ 2.7 billion and $ 2.9 billion, with gains and losses recognized in “Other income (expense), net” on our consolidated statements of operations.

As of December 31, 2025 and March 31, 2026, these warrants had a fair value of $ 2.7 billion and $ 2.4 billion, with gains and losses recognized in “Other income (expense), net” on our consolidated statements of operations.

These warrants are classified as Level 2 and 3 assets.

These non-marketable investments are included within “Other assets” on our consolidated balance sheets.

Certain of our investments represent a variable interest in an entity for which we do not consolidate because we are not the primary beneficiary.

Certain of our investments, including our investments in Anthropic and OpenAI, represent a variable interest in an entity for which we do not consolidate because we are not the primary beneficiary.

Our maximum exposure to loss is generally limited to the current carrying values of these investments and any future funding commitments.

Consolidated Statements of Cash Flows Reconciliation

The following table provides a reconciliation of the amount of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets to the total of the same such amounts shown in the consolidated statements of cash flows (in millions):

December 31, 2024 September 30, 2025

December 31, 2025 March 31, 2026

Cash and cash equivalents $ 86,810 $ 101,816

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We have entered into non-cancellable operating and finance leases for fulfillment network, data center, office, and physical store facilities as well as server and networking equipment, aircraft, and vehicles.

Gross assets acquired under finance leases, including those where title transfers at the end of the lease, are recorded in “ Property and equipment, net ” and were $ 56.5 billion and $ 56.0 billion as of December 31, 2024 and September 30, 2025.

Accumulated amortization associated with finance leases was $ 41.8 billion and $ 41.1 billion as of December 31, 2024 and September 30, 2025.

Gross assets acquired under finance leases, including those where title transfers at the end of the lease, are recorded in “ Property and equipment, net ” and were $ 55.6 billion and $ 56.4 billion as of December 31, 2025 and March 31, 2026.

Accumulated amortization associated with finance leases was $ 40.4 billion as of December 31, 2025 and March 31, 2026.

Lease cost recognized in our consolidated statements of operations is summarized as follows (in millions):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2025 2024 2025

Three Months Ended March 31,

Operating lease cost $ 3,240 $ 3,917

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Other information about lease amounts recognized in our consolidated financial statements is as follows:

December 31, 2024 September 30, 2025

December 31, 2025 March 31, 2026

Weighted-average remaining lease term – operating leases 10.0 years 10.0 years

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Total long-term lease liabilities $ 76,597 $ 10,742 $ 87,339

September 30, 2025

March 31, 2026

Operating Leases Finance Leases Total

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Note 4 — COMMITMENTS AND CONTINGENCIES

The following summarizes our principal contractual commitments, excluding open orders for purchases that support normal operations and are generally cancellable, as of September 30, 2025 (in millions):

Three Months Ended December 31, Year Ended December 31,

The following summarizes our principal contractual commitments, excluding open orders for purchases that support normal operations and are generally cancellable, as of March 31, 2026 (in millions):

Nine Months Ended December 31, Year Ended December 31,

2026 2027 2028 2029 2030 Thereafter Total

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(1) Includes non-cancellable financing obligations for fulfillment network and data center facilities.

Excluding interest, current financing obligations of $ 312 million and $ 281 million are recorded within “Accrued expenses and other” and $ 7.1 billion and $ 7.2 billion are recorded within “Other long-term liabilities” as of December 31, 2024 and September 30, 2025.

The weighted-average remaining term of the financing obligations was 16.1 years and 15.3 years and the weighted-average imputed interest rate was 3.1 % as of December 31, 2024 and September 30, 2025.

(2) Includes unconditional purchase obligations related to long-term agreements to acquire and license digital media content, procure energy, acquire property and equipment, and license software that are not reflected on the consolidated balance sheets.

For those agreements with variable terms, we do not estimate the total obligation beyond any minimum quantities and/or pricing, or termination penalties, as of the reporting date.

Excluding interest, current financing obligations of $ 358 million and $ 340 million are recorded within “Accrued expenses and other” and $ 7.8 billion and $ 8.2 billion are recorded within “Other long-term liabilities” as of December 31, 2025 and March 31, 2026.

The weighted-average remaining term of the financing obligations was 15.0 years and the weighted-average imputed interest rate was 2.9 % and 3.1 % as of December 31, 2025 and March 31, 2026.

(2) Includes unconditional purchase obligations related to long-term agreements to procure energy, acquire and license digital media content, acquire property and equipment, and license software that are not reflected on the consolidated balance sheets.

For those agreements with variable terms or subject to certain regulatory approvals, we do not estimate the total obligation beyond any minimum quantities and/or pricing, or termination penalties, as of the reporting date.

Purchase obligations associated with renewal provisions solely at the option of the content provider are included to the extent such commitments are fixed or a minimum amount is specified.

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Excludes approximately $ 6.7 billion of income tax contingencies for which we cannot make a reasonably reliable estimate of the amount and period of payment, if any.

On April 13, 2026, Amazon entered into a definitive merger agreement to acquire Globalstar, Inc.

(“Globalstar”), a Delaware corporation, for a mix of cash and stock consideration.

Under the terms of the merger agreement, prior to closing, Globalstar stockholders will elect to receive, for each share of Globalstar common stock they own, either (i) $ 90.00 in cash or (ii) 0.3210 shares of Amazon common stock (with a value capped at $ 90.00 per share).

The value of the total consideration will vary based on the price of shares of Amazon common stock and the elections of Globalstar stockholders.

The total consideration is also subject to (i) a proration mechanism that caps aggregate cash elections to a maximum of 40 % of total Globalstar shares, and automatically converts excess cash consideration into stock consideration on a pro rata basis and (ii) a downward adjustment of a maximum of $ 110 million in the event Globalstar does not meet certain operational milestones.

As of the date of the merger agreement, the acquisition implied a value for Globalstar of approximately $ 10.9 billion, including its debt.

On the date of the merger agreement, we also entered into agreements with Apple Inc.

(“Apple”), Globalstar’s largest customer, to provide certain services after the acquisition and to redeem certain equity interests held by Apple in a Globalstar special purpose entity.

The acquisition is expected to close in 2027, subject to the satisfaction of certain closing conditions, including receipt of regulatory approvals and Globalstar’s achievement of certain satellite replacement milestones.

Other Contingencies

We are disputing claims and denials of refunds or credits, and monitoring or evaluating potential claims, related to various non-income taxes (such as sales, value added, consumption, service, and similar taxes), including in jurisdictions in which we already collect and remit these taxes.

These non-income tax controversies typically include (i) the taxability of products and services, including cross-border intercompany transactions, (ii) collection and withholding on transactions with third parties, including as a result of evolving requirements imposed on marketplaces with respect to third-party sellers, and (iii) the adequacy of compliance with reporting obligations, including evolving documentation requirements.

third parties, including as a result of evolving requirements imposed on marketplaces with respect to third-party sellers, and (iii) the adequacy of compliance with reporting obligations, including evolving documentation requirements.

Due to the inherent complexity and uncertainty of these matters and the judicial and regulatory processes in certain jurisdictions, the final outcome of any such controversies may be materially different from our expectations.

Legal Proceedings

The Company is involved from time to time in claims, proceedings, and litigation, including the matters described in Item 8 of Part II, “Financial Statements and Supplementary Data — Note 7 — Commitments and Contingencies — Legal Proceedings” of our 2024 Annual Report on Form 10-K and in Item 1 of Part I, “Financial Statements — Note 4 — Commitments and Contingencies — Legal Proceedings” of our Quarterly Reports on Form 10-Q for the periods ended March 31, 2025 and June 30, 2025, as supplemented by the following:

Since March 2020, private litigants, state Attorneys General, and the Federal Trade Commission have filed cases in the U.S., Canada, and the United Kingdom alleging, among other things:

price fixing arrangements between each of Amazon and its vendors and Amazon and its third-party sellers;

abuse of dominance, monopolization, and attempted monopolization;

and consumer protection and unjust enrichment claims, in violation of federal and state antitrust, state consumer protection, and

Canadian and U.K.

antitrust laws.

The first of these complaints was Frame-Wilson v.

Amazon.com, Inc., which was filed in the United States District Court for the Western District of Washington (“W.D.

These complaints seek billions of dollars of alleged damages, treble damages, punitive damages, injunctive relief, structural relief, civil penalties, attorneys’ fees, and costs.

Some of the private plaintiff cases include allegations of distinct purported classes, including consumers who purchased a product through Amazon’s stores and consumers who purchased a product offered by Amazon through another e-commerce retailer.

Some of the cases include allegations that Amazon has a monopoly in markets for online superstores, marketplace services, or intermediation services and that we unlawfully engage in anticompetitive practices relating to our pricing policies, selection of the Featured Offers, use of seller data, advertising practices, the structure of Prime, and promotion of our own products on our website.

In the U.S., most of Amazon’s motions to dismiss were granted in part, but in each case, at least some of the claims survived.

In Canada, class certification was denied in a case before the Federal Court of Canada, finding that plaintiffs had not stated a viable claim, and plaintiffs’ appeal of that ruling is pending.

Two Canadian class actions before other courts are pre-certification.

In the United Kingdom, two class actions have been certified and a third is pre-certification.

In the U.S., one class action has been certified, and three others are pre-certification.

We dispute the allegations of wrongdoing and intend to defend ourselves vigorously in these matters.

In December 2021, the Italian Competition Authority (the “ICA”) issued a decision against Amazon Services Europe S.à r.l., Amazon Europe Core S.à r.l., Amazon EU S.à r.l., Amazon Italia Services S.r.l., and Amazon Italia Logistica S.r.l.

claiming that certain of our marketplace and logistics practices in Italy infringe EU competition rules.

The decision imposes remedial actions and a fine of € 1.13 billion, which we have paid and will seek to recover pending conclusion of all appeals.

In September 2025, the Italian Administrative Tribunal (the “TAR”) affirmed the ICA’s decision but reduced the fine to € 752 million.

We believe the TAR’s ruling affirming the ICA’s decision to be without merit and will continue to defend ourselves vigorously in this matter.

In addition, we are regularly subject to claims, litigation, and other proceedings, including potential regulatory proceedings, involving patent and other intellectual property matters, taxes, labor and employment, competition and antitrust, privacy and data protection, consumer protection, commercial disputes, goods and services offered by us and by third parties, and other matters.

In May 2018, Rensselaer Polytechnic Institute and CF Dynamic Advances LLC filed a complaint against Amazon.com, Inc.

in the United States District Court for the Northern District of New York.

The complaint alleged, among other things, that “Alexa Voice Software and Alexa enabled devices” infringe U.S.

The complaint sought an injunction, an unspecified amount of damages, enhanced damages , an ongoing royalty, interest, attorneys’ fees, and costs.

In March 2023, the plaintiffs alleged in their damages report that in the event of a finding of liability Amazon could be subject to $ 140 million to $ 267 million in damages.

In March 2024, the district court granted summary judgment ruling that the patent is invalid and dismissed the case.

In April 2024, the plaintiffs filed a notice of appeal.

In February 2026, the United States Court of Appeals for the Federal Circuit affirmed the district court’s judgment.

This decision is subject to appeal.

We dispute the allegations of wrongdoing and will continue to defend ourselves vigorously in this matter.

In addition, we are regularly subject to claims, litigation, and other proceedings, including government inquiries and investigations that could lead to the foregoing and potential regulatory proceedings, involving patent and other intellectual property matters, taxes, labor and employment, competition and antitrust, privacy and data protection, consumer protection, commercial disputes, goods and services offered by us and by third parties, and other matters.

The outcomes of our legal proceedings and other contingencies are inherently unpredictable, subject to significant uncertainties, and could be material to our operating results and cash flows for a particular period.

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Note 5 — DEBT

As of September 30, 2025, we had $ 54.3 billion of unsecured senior notes outstanding (the “Notes”).

As of March 31, 2026, we had $ 121.8 billion of unsecured senior notes outstanding (the “Notes”), including € 14.5 billion ($ 16.8 billion) and $ 37.0 billion issued in March 2026 for general corporate purposes.

Our total long-term debt obligations are as follows (in millions):

Maturities (1) Stated Interest Rates Effective Interest Rates December 31, 2024 September 30, 2025

Maturities (1) Stated Interest Rates Effective Interest Rates December 31, 2025 March 31, 2026

2014 Notes issuance of $ 6.0 billion

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4.61 % - 4.74 %

2025 Notes issuance of $ 15.0 billion

2028 - 2065 3.90 % - 5.55 %

3.99 % - 5.62 %

15,000 15,000

March 2026 Notes issuance of $ 37.0 billion (2)

2028 - 2076 3.85 % - 6.05 %

3.97 % - 6.12 %

March 2026 Euro-denominated Notes issuance of € 14.5 billion (3)

2028 - 2064 2.50 % - 4.85 %

2.59 % - 4.88 %

Other long-term debt 836 850

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(1) The weighted-average remaining lives of the 2014, 2017, 2020, 2021, April 2022, and December 2022 Notes were 14.6 , 15.7 , 18.4 , 13.4 , 14.0 , and 3.9 years as of September 30, 2025.

The combined weighted-average remaining life of the Notes was 13.6 years as of September 30, 2025.

Interest on the Notes is payable semi-annually in arrears.

(1) The weighted-average remaining lives of the 2014, 2017, 2020, 2021, April 2022, December 2022, 2025, March 2026, and March 2026 Euro-denominated Notes were 14.1 , 15.2 , 17.9 , 12.9 , 13.5 , 4.2 , 15.4 , 16.7 , and 10.3 years as of March 31, 2026.

The combined weighted-average remaining life of the Notes was 14.2 years as of March 31, 2026.

(2) Includes $ 2.8 billion of floating rate notes due in 2028 and 2029.

Interest is calculated using the compounded Secured Overnight Financing Rate (“SOFR”) plus 0.44 % and 0.59 %, respectively, and payable quarterly in arrears.

(3) Includes € 1.8 billion of floating rate notes due in 2028.

Interest is calculated using Euro Interbank Offered Rate (“EURIBOR”) plus 0.35 %, payable quarterly in arrears.

Interest on the Notes is primarily payable semi-annually in arrears except for the March 2026 Euro-denominated Notes for which interest is primarily payable annually in arrears.

We may redeem the Notes at any time in whole, or from time to time, in part at specified redemption prices.

The floating rate notes are generally not redeemable prior to maturity.

We are not subject to any financial covenants under the Notes.

The estimated fair value of the Notes was approximately $ 50.2 billion and $ 47.9 billion as of December 31, 2024 and September 30, 2025, which is based on quoted prices for our debt as of those dates.

As of September 30, 2024, we had repaid outstanding borrowings and terminated the secured revolving credit facility with a lender that was secured by certain seller receivables (the “Credit Facility”).

The Credit Facility bore interest based on the daily Secured Overnight Financing Rate plus 1.25 %, and had a commitment fee of up to 0.45 % on the undrawn portion.

In January 2023, we entered into an $ 8.0 billion unsecured 364-day term loan with a syndicate of lenders (the “Term Loan”), maturing in January 2024 and bearing interest at the Secured Overnight Financing Rate specified in the Term Loan plus 0.75 %.

The Term Loan was classified as short-term debt and included within “Accrued expenses and other” on our consolidated balance sheets.

As of December 31, 2023, the entire amount of the Term Loan had been repaid.

The estimated fair value of the Notes was approximately $ 61.1 billion and $ 113.6 billion as of December 31, 2025 and March 31, 2026, which is based on quoted prices for our debt as of those dates.

Dollar and Euro commercial paper programs (the “Commercial Paper Programs”) under which we may from time to time issue unsecured commercial paper up to a total of $ 30.0 billion (including up to € 3.0 billion) at the date of issue, with individual maturities that may vary but will not exceed 397 days from the date of issue.

In April 2025, we increased the size of the Commercial Paper Programs from $ 20.0 billion to $ 30.0 billion.

There were no borrowings outstanding under the Commercial Paper Programs as of December 31, 2024 and September 30, 2025.

There were no borrowings outstanding under the Commercial Paper Programs as of December 31, 2025 and March 31, 2026.

We use the net proceeds from the issuance of commercial paper for general corporate purposes.

We have a $ 15.0 billion unsecured revolving credit facility with a syndicate of lenders (the “Credit Agreement”), with a term that extends to November 2028 and may be extended for one or more additional one-year terms subject to approval by the lenders.

We have an aggregate $ 20.0 billion in unsecured revolving credit facilities with syndicates of lenders, consisting of a $ 15.0 billion facility (the “Credit Agreement”) and a $ 5.0 billion 364-day facility (the “Short-Term Credit Agreement”).

The Credit Agreement has a term that extends to November 2028 and may be extended for one or more additional one-year terms subject to approval by the lenders.

The interest rate applicable to outstanding balances under the Credit Agreement is the applicable benchmark rate specified in the Credit Agreement plus 0.45 %, with a commitment fee of 0.03 % on the undrawn portion of the credit facility.

There were no borrowings outstanding under the Credit Agreement as of December 31, 2024 and September 30, 2025.

As of September 30, 2025, we had a $ 5.0 billion unsecured 364-day revolving credit facility with a syndicate of lenders (the “2024 Short-Term Credit Agreement”).

The interest rate applicable to outstanding balances under the 2024 Short-Term Credit Agreement is the Secured Overnight Financing Rate specified in the 2024 Short-Term Credit Agreement plus 0.45 %, with a commitment fee of 0.03 % on the undrawn portion.

There were no borrowings outstanding under the 2024 Short-Term Credit Agreement as of December 31, 2024 and September 30, 2025.

In October 2025, we replaced the 2024 Short-Term Credit Agreement with a new $ 5.0 billion unsecured 364-day revolving credit facility with a syndicate of lenders on substantially the same terms, which matures in October 2026 and may be extended for one additional period of 364 days subject to approval by the lenders.

The Short-Term Credit Agreement matures in October 2026 and may be extended for one additional period of 364 days subject to approval by the lenders.

The interest rate applicable to outstanding balances under the Short-Term Credit Agreement is the SOFR specified in the Short-Term Credit Agreement plus 0.45 %, with a commitment fee of 0.03 % on the undrawn portion.

There were no borrowings outstanding under the Credit Agreement and the Short-Term Credit Agreement as of December 31, 2025 and March 31, 2026.

We also utilize other short-term credit facilities for working capital purposes.

There were $ 151 million and $ 220 million of borrowings outstanding under these facilities as of December 31, 2024 and September 30, 2025, which were included in “Accrued expenses and other” on our consolidated balance sheets.

In addition, we had $ 10.6 billion of unused letters of credit as of September 30, 2025.

There were $ 455 million and $ 152 million of borrowings outstanding under these facilities as of December 31, 2025 and March 31, 2026, which were included in “Accrued expenses and other” on our consolidated balance sheets.

In addition, we had $ 9.4 billion of unused letters of credit as of March 31, 2026.

Note 6 — STOCKHOLDERS’ EQUITY

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In March 2022, the Board of Directors authorized a program to repurchase up to $ 10.0 billion of our common stock, with no fixed expiration.

There were no repurchases of our common stock during the nine months ended September 30, 2024 or 2025.

As of September 30, 2025, we have $ 6.1 billion remaining under the repurchase program.

There were no repurchases of our common stock during the three months ended March 31, 2025 or 2026.

As of March 31, 2026, we have $ 6.1 billion remaining under the repurchase program.

Stock Award Plans

Employees vest in restricted stock unit awards over the corresponding service term, generally between two and five years .

The majority of restricted stock unit awards are granted at the date of hire or in Q2 as part of the annual compensation review and primarily vest quarterly in the relevant compensation year.

The majority of outstanding restricted stock unit awards are granted at the date of hire or in Q2 as part of the annual compensation review and primarily vest quarterly in the relevant compensation year.

Stock Award Activity

Common shares outstanding plus shares underlying outstanding stock awards totaled 10.9 billion and 11.0 billion as of December 31, 2024 and September 30, 2025.

Common shares outstanding plus shares underlying outstanding stock awards totaled 11.0 billion and 10.9 billion as of December 31, 2025 and March 31, 2026.

These totals include all vested and unvested stock awards outstanding, including those awards we estimate will be forfeited.

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

Cost of sales $ 148 $ 171

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Total stock-based compensation expense $ 3,689 $ 4,032

The following table summarizes our restricted stock unit activity for the nine months ended September 30, 2025 (in millions):

The following table summarizes our restricted stock unit activity for the three months ended March 31, 2026 (in millions):

Number of Units Weighted-Average

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Units forfeited ( 11.9 ) 175

Outstanding as of September 30, 2025 268.1 168

Scheduled vesting for outstanding restricted stock units as of September 30, 2025, is as follows (in millions):

Three Months Ended December 31, Year Ended December 31,

Outstanding as of March 31, 2026 195.1 183

Scheduled vesting for outstanding restricted stock units as of March 31, 2026, is as follows (in millions):

Nine Months Ended December 31, Year Ended December 31,

2026 2027 2028 2029 2030 Thereafter Total

Scheduled vesting — restricted stock units 83.0 67.3 31.3 11.5 1.2 0.8 195.1

As of September 30, 2025, there was $ 20.1 billion of net unrecognized compensation cost related to unvested stock-based compensation arrangements.

This compensation is recognized on an accelerated basis with more than half of the compensation expected to be expensed in the next twelve months, and has a remaining weighted-average recognition period of 1.0 year.

As of March 31, 2026, there was $ 14.4 billion of net unrecognized compensation cost related to unvested stock-based compensation arrangements.

Changes in Stockholders’ Equity

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

Total beginning stockholders’ equity $ 285,970 $ 411,065

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Total ending stockholders’ equity $ 305,867 $ 441,914

Accumulated Other Comprehensive Income (Loss)

The following table summarizes the changes in “Accumulated other comprehensive income (loss)” by separate components (in millions):

Three Months Ended

Total beginning accumulated other comprehensive income (loss), net of tax of $( 1,762 ) and $( 9,384 )

$ ( 34 ) $ 28,230

Foreign currency translation adjustments:

Beginning balance, net of tax of $ 292 and $ 98

( 6,174 ) ( 1,948 )

Foreign currency translation adjustments, net of tax of $( 66 ) and $( 13 )

1,535 ( 764 )

Ending balance, net of tax of $ 226 and $ 85

( 4,639 ) ( 2,712 )

Unrealized gains (losses) on net investment hedging instruments:

Beginning balance, net of tax of $ 0 and $ 0

Change in net unrealized gains (losses), net of tax of $ 0 and $ 24

Ending balance, net of tax of $ 0 and $ 24

Unrealized gains (losses) on available-for-sale debt securities:

Beginning balance, net of tax of $( 2,054 ) and $( 9,481 )

Change in net unrealized gains (losses), net of tax of $( 11 ) and $( 340 )

Reclassification adjustments for net losses (gains) included in “Other income (expense), net,” net of tax of $ 809 and $ 1,142

( 2,454 ) ( 3,337 )

Ending balance, net of tax of $( 1,256 ) and $( 8,679 )

Beginning balance, net of tax of $ 0 and $( 1 )

Other, net of tax of $ 1 and $( 2 )

Ending balance, net of tax of $ 1 and $( 3 )

Total ending accumulated other comprehensive income (loss), net of tax of $( 1,029 ) and $( 8,573 )

$ ( 914 ) $ 24,868

Note 7 — INCOME TAXES

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In addition, we record valuation allowances against deferred tax assets when there is uncertainty about our ability to generate future income in relevant jurisdictions.

The One Big Beautiful Bill Act of 2025 (the “2025 Tax Act”) was signed into law on July 4, 2025.

The 2025 Tax Act makes changes to the U.S.

corporate income tax, including reinstating the option to claim 100% accelerated depreciation deductions on qualified property, with retroactive application beginning January 20, 2025, and immediate expensing of domestic research and development costs, with retroactive application beginning January 1, 2025.

The 2025 Tax Act increased our income tax provision for the nine months ended September 30, 2025, primarily due to a decrease in the foreign income deduction, and will significantly decrease our cash taxes in 2025.

For 2025, we estimate that our effective tax rate will be favorably impacted by the U.S.

federal research and development credit and adversely affected by state income taxes.

Our income tax provision for the nine months ended September 30, 2024 was $ 6.9 billion, which included $ 2.4 billion of net discrete tax benefits primarily attributable to excess tax benefits from stock-based compensation.

Our income tax provision

for the nine months ended September 30, 2025 was $ 14.1 billion, which included $ 354 million of net discrete tax expense primarily attributable to the net gains from our investments in Anthropic, partially offset by excess tax benefits from stock-based compensation.

Cash paid for income taxes, net of refunds was $ 2.0 billion and $ 1.1 billion in Q3 2024 and Q3 2025, and $ 8.2 billion and $ 6.8 billion for the nine months ended September 30, 2024 and 2025.

As of December 31, 2024 and September 30, 2025, income tax contingencies were approximately $ 6.5 billion and $ 5.9 billion.

For 2026, we estimate that our effective tax rate will be adversely affected by state income taxes and favorably impacted by the U.S.

federal research and development credit.

Our income tax provision for the three months ended March 31, 2025 was $ 4.6 billion, which included $ 559 million of net discrete tax expense.

Our income tax provision for the three months ended March 31, 2026 was $ 9.6 billion, which included $ 4.1 billion of net discrete tax expense primarily attributable to the net gains from our investments in Anthropic.

On February 18, 2026, the IRS issued Notice 2026-7 (the “2026 Notice”), which included guidance on the U.S.

tax treatment of previously capitalized domestic research and development costs.

We expect the 2026 Notice, which applied retroactively to 2025, to result in a significant decrease of 2024 and 2025 cash taxes paid.

Cash paid for income taxes, net of refunds was $ 877 million and $ 1.3 billion in Q1 2025 and Q1 2026.

As of December 31, 2025 and March 31, 2026, income tax contingencies were approximately $ 6.6 billion and $ 6.7 billion.

Changes in tax laws, regulations, administrative practices, principles, and interpretations may impact our tax contingencies.

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These examinations may lead to ordinary course adjustments or proposed adjustments to our taxes or our net operating losses with respect to years under examination as well as subsequent periods.

We are also subject to taxation in various states and foreign jurisdictions including China, France, Germany, India, Japan, Luxembourg, and the United Kingdom.

We are also subject to taxation in various states and foreign jurisdictions including Germany, India, Japan, Luxembourg, and the United Kingdom.

We are under, or may be subject to, audit or examination and additional assessments by the relevant authorities in respect of these particular jurisdictions primarily for 2011 and thereafter.

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

North America

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Operating income 18,405 23,852

Total non-operating income (expense) 626 10,748 ( 1,125 ) 15,708

Total non-operating income 3,274 15,982

Provision for income taxes ( 4,553 ) ( 9,560 )

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

Online stores (1) $ 57,407 $ 64,254

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Total segment assets reconciled to consolidated amounts are as follows (in millions):

December 31, 2024 September 30, 2025

December 31, 2025 March 31, 2026

North America (1) $ 235,652 $ 241,817

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Property and equipment, net by segment is as follows (in millions):

December 31, 2024 September 30, 2025

December 31, 2025 March 31, 2026

North America $ 122,043 $ 129,241

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

North America (1) $ 5,096 $ 11,126

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___________________

(1) Includes property and equipment added under finance leases of $ 182 million and $ 432 million in Q3 2024 and Q3 2025, and $ 324 million and $ 507 million for the nine months ended September 30, 2024 and 2025.

(2) Includes property and equipment added under finance leases of $ 4 million and $ 545 million in Q3 2024 and Q3 2025, and $ 85 million and $ 1.5 billion for the nine months ended September 30, 2024 and 2025.

(1) Includes property and equipment added under finance leases of $ 54 million and $ 237 million in Q1 2025 and Q1 2026.

(2) Includes property and equipment added under finance leases of $ 0 million and $ 1.3 billion in Q1 2025 and Q1 2026.

Depreciation and amortization expense on property and equipment, including corporate property and equipment, are allocated to all segments based on usage.

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Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2025 2024 2025

North America $ 3,530 $ 4,280

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements