What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-07-31 compared with 2026-04-30 · 87 added, 64 removed, 207 unchanged (42% of the section changed)

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These assumptions about future disposition of inventory are inherently uncertain and changes in our estimates and assumptions may cause us to realize material write-downs in the future.

As a measure of sensitivity, for every 1% of additional inventory valuation allowance as of March 31, 2026, we would have recorded an additional cost of sales of approximately $385 million.

As a measure of sensitivity, for every 1% of additional inventory valuation allowance as of June 30, 2026, we would have recorded an additional cost of sales of approximately $405 million.

In addition, we enter into supplier commitments for certain electronic device components and certain products.

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Three Months Ended

March 31, Twelve Months Ended

June 30, Six Months Ended

June 30, Twelve Months Ended

2025 2026 2025 2026 2025 2026

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Financing activities (2,539) 10,146 (2,586) 62,913 (8,652) 75,160

Our principal sources of liquidity are cash flows generated from operations and our cash, cash equivalents, and marketable securities balances, which, at fair value, were $123.0 billion and $143.1 billion as of December 31, 2025 and March 31, 2026.

Amounts held in foreign currencies were $29.7 billion and $22.1 billion as of December 31, 2025 and March 31, 2026.

Amounts held in foreign currencies were $29.7 billion and $20.4 billion as of December 31, 2025 and June 30, 2026.

Our foreign currency balances include British Pounds, Canadian Dollars, Euros, Indian Rupees, and Japanese Yen.

Cash provided by (used in) operating activities was $17.0 billion and $26.0 billion for Q1 2025 and Q1 2026.

Cash provided by (used in) operating activities was $32.5 billion and $45.4 billion for Q2 2025 and Q2 2026, and $49.5 billion and $71.4 billion for the six months ended June 30, 2025 and 2026.

Our operating cash flows result primarily from cash received from our consumer, seller, developer, enterprise, and content creator customers, and advertisers, offset by cash payments we make for products and services, employee compensation, payment processing and related transaction costs, operating leases, and interest payments.

Cash received from our customers and other activities generally corresponds to our net sales.

The increase in operating cash flow for the trailing twelve months ended March 31, 2026, compared to the comparable prior year period, was due to an increase in net income, excluding non-cash expenses, and changes in working capital.

The increase in operating cash flow for the trailing twelve months ended June 30, 2026, compared to the comparable prior year period, was due to an increase in net income, excluding non-cash income and expenses, and changes in working capital.

Working capital at any specific point in time is subject to many variables, including variability in demand, inventory management and category expansion, the timing of cash receipts and payments, customer and vendor payment terms, and fluctuations in foreign exchange rates.

Cash provided by (used in) investing activities corresponds with cash capital expenditures, including leasehold improvements, incentives received from property and equipment vendors, proceeds from asset sales, cash outlays for acquisitions, investments in other companies and intellectual property rights, and purchases, sales, and maturities of marketable securities.

Cash provided by (used in) investing activities was $(29.8) billion and $(64.2) billion for Q1 2025 and Q1 2026, with the variability caused primarily by purchases, sales, and maturities of marketable securities and cash capital expenditures.

Cash capital expenditures were $24.3 billion and $43.2 billion during Q1 2025 and Q1 2026, which primarily reflect investments in technology infrastructure (the majority of which is to support AWS business growth) and in additional capacity to support our fulfillment network, both of which we expect to increase in 2026.

We did not have significant acquisition and other investment activity during Q1 2025.

We made cash payments, net of acquired cash, related to acquisition and other investment activity of $15.4 billion during Q1 2026.

In Q1 2026, we invested $15.0 billion in OpenAI’s Series C Preferred Stock and entered into an equity commitment letter agreement to purchase an additional $35.0 billion of OpenAI’s Series C Preferred Stock, subject to certain conditions.

We expect to fund this investment with cash on hand.

Cash provided by (used in) financing activities was $(47) million and $52.8 billion for Q1 2025 and Q1 2026.

Cash inflows from financing activities resulted from proceeds from short-term debt, and other and long-term debt of $2.6 billion and $59.5 billion for Q1 2025 and Q1 2026.

Cash provided by (used in) investing activities was $(39.4) billion and $(79.2) billion for Q2 2025 and Q2 2026, and $(69.2) billion and $(143.5) billion for the six months ended June 30, 2025 and 2026, with the variability caused primarily by purchases, sales, and maturities of marketable securities and cash capital expenditures.

Cash capital expenditures were $31.4 billion and $53.1 billion during Q2 2025 and Q2 2026, and $55.6 billion and $96.3 billion for the six months ended June 30, 2025 and 2026, which primarily reflect investments in technology infrastructure (the majority of which is to support AWS business growth) and in additional capacity to support our fulfillment network, both of which we expect to increase in 2026.

We made cash payments, net of acquired cash, related to acquisition and other investment activity of $1.7 billion and $24.4 billion during Q2 2025 and Q2 2026, and $1.7 billion and $39.8 billion for the six months ended June 30, 2025 and 2026.

In Q2 2025, we invested $1.3 billion in convertible notes from Anthropic.

We invested $28.7 billion in OpenAI’s Series C Preferred Stock for the six months ended June 30, 2026, including $13.7 billion invested in Q2 2026.

Subsequent to June 30, 2026, we funded

the remaining Commitment Amount of $21.3 billion.

In Q2 2026, we also invested $10.0 billion in Anthropic nonvoting preferred stock.

Cash provided by (used in) financing activities was $(2.5) billion and $10.1 billion for Q2 2025 and Q2 2026, and $(2.6) billion and $62.9 billion for the six months ended June 30, 2025 and 2026.

Cash inflows from financing activities resulted from proceeds from short-term debt, and other and long-term debt of $2.1 billion and $22.9 billion for Q2 2025 and Q2 2026, and $4.7 billion and $82.4 billion for the six months ended June 30, 2025 and 2026.

We expect to undertake additional financing activities in 2026.

Cash outflows from financing activities resulted from payments of short-term debt, and other, long-term debt, finance leases, and financing obligations of $2.6 billion and $6.7 billion for Q1 2025 and Q1 2026.

Property and equipment acquired under finance leases was $54 million and $1.6 billion during Q1 2025 and Q1 2026.

We had no borrowings outstanding under the two unsecured revolving credit facilities or the commercial paper programs as of March 31, 2026.

Cash outflows from financing activities resulted from payments of short-term debt, and other, long-term debt, finance leases, and financing obligations of $4.6 billion and $12.8 billion for Q2 2025 and Q2 2026, and $7.2 billion and $19.5 billion for the six months ended June 30, 2025 and 2026.

Property and equipment acquired under finance leases was $937 million and $563 million during Q2 2025 and Q2 2026, and $991 million and $2.1 billion for the six months ended June 30, 2025 and 2026.

We had no borrowings outstanding under the two unsecured revolving credit facilities or the commercial paper programs as of June 30, 2026.

See Item 1 of Part I, “Financial Statements — Note 5 — Debt” for additional information.

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Cash paid for U.S.

(federal and state) and foreign income taxes (net of refunds) totaled $877 million and $1.3 billion for Q1 2025 and Q1 2026.

As of December 31, 2025 and March 31, 2026, restricted cash, cash equivalents, and marketable securities were $3.3 billion and $2.9 billion.

(federal and state) and foreign income taxes (net of refunds) totaled $4.8 billion and $2.7 billion for Q2 2025 and Q2 2026, and $5.6 billion and $4.0 billion for the six months ended June 30, 2025 and 2026.

As of December 31, 2025 and June 30, 2026, restricted cash, cash equivalents, and marketable securities were $3.3 billion and $2.7 billion.

See Item 1 of Part I, “Financial Statements — Note 4 — Commitments and Contingencies” and “Financial Statements — Note 5 — Debt” for additional discussion of our principal contractual commitments, as well as our pledged assets.

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Product sales represent revenue from the sale of products and related shipping fees and digital media content where we record revenue gross.

Service sales primarily represent third-party seller fees, which includes commissions and any related fulfillment and shipping fees, AWS sales, advertising services, Amazon Prime membership fees, and certain digital media content subscriptions.

Service sales primarily represent third-party seller fees, which include commissions and any related fulfillment and shipping fees, AWS sales, advertising services, Amazon Prime membership fees, and certain digital media content subscriptions.

Net sales information is as follows (in millions):

Three Months Ended

June 30, Six Months Ended

2025 2026 2025 2026

North America $ 100,068 $ 116,177 $ 192,955 $ 220,320

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International 16 15 10 17

AWS 17 37 17 33

Consolidated 13 20 11 18

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International 11 15 9 13

AWS 17 37 17 33

Consolidated 12 20 11 17

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International 22 21 22 21

AWS 18 21 18 21

Consolidated 100 % 100 % 100 % 100 %

Sales increased 17% in Q1 2026 compared to the comparable prior year period.

Changes in foreign exchange rates increased net sales by $2.9 billion for Q1 2026.

Sales increased 20% in Q2 2026, and 18% for the six months ended June 30, 2026 compared to the comparable prior year periods.

Changes in foreign exchange rates did not significantly impact net sales for Q2 2026, but increased net sales by $3.0 billion for the six months ended June 30, 2026.

For a discussion of the effect of foreign exchange rates on sales growth, see “Effect of Foreign Exchange Rates” below.

North America sales increased 12% in Q1 2026 compared to the comparable prior year period.

North America sales increased 16% in Q2 2026, and 14% for the six months ended June 30, 2026 compared to the comparable prior year periods.

The sales growth primarily reflects increased unit sales, including sales by third-party sellers, advertising sales, and subscription services.

Increased unit sales were driven largely by our continued focus on price, selection, and convenience for our customers, including from our fast shipping offers.

Changes in foreign exchange rates increased North America net sales by $346 million for Q1 2026.

International sales increased 19% in Q1 2026 compared to the comparable prior year period.

Increased unit sales were driven largely by our continued focus on price, selection, and

convenience for our customers, including from our fast shipping offers.

Changes in foreign exchange rates increased North America net sales by $139 million for Q2 2026, and by $485 million for the six months ended June 30, 2026.

International sales increased 15% in Q2 2026, and 17% for the six months ended June 30, 2026 compared to the comparable prior year periods.

The sales growth primarily reflects increased unit sales, including sales by third-party sellers, advertising sales, and subscription services.

Increased unit sales were driven largely by our continued focus on price, selection, and convenience for our customers, including from our fast shipping offers.

Changes in foreign exchange rates increased International net sales by $2.5 billion for Q1 2026.

AWS sales increased 28% in Q1 2026 compared to the comparable prior year period.

Changes in foreign exchange rates did not significantly impact International net sales for Q2 2026, but increased International net sales by $2.4 billion for the six months ended June 30, 2026 .

AWS sales increased 37% in Q2 2026, and 33% for the six months ended June 30, 2026 compared to the comparable prior year periods.

The sales growth primarily reflects increased customer usage, partially offset by pricing changes primarily driven by long-term customer contracts.

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Three Months Ended

June 30, Six Months Ended

2025 2026 2025 2026

Operating Expenses:

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Cost of sales primarily consists of the purchase price of consumer products, inbound and outbound shipping costs, including costs related to sortation and delivery centers and where we are the transportation service provider, and digital media content costs where we record revenue gross, including video and music.

The increase in cost of sales in Q1 2026, compared to the comparable prior year period, is primarily due to increased product and shipping costs resulting from increased sales, partially offset by operational efficiencies.

Changes in foreign exchange rates increased cost of sales by $1.8 billion for Q1 2026.

Shipping costs were $22.5 billion and $25.7 billion in Q1 2025 and Q1 2026.

The increase in cost of sales in Q2 2026 and for the six months ended June 30, 2026, compared to the comparable prior year periods, is primarily due to increased product and shipping costs resulting from increased sales, partially offset by operational efficiencies.

Cost of sales in Q2 2026 includes tariff refunds received under the IEEPA.

Changes in foreign exchange rates did not significantly impact cost of sales for Q2 2026, but increased cost of sales by $1.8 billion for the six months ended June 30, 2026.

Shipping costs were $23.4 billion and $27.9 billion in Q2 2025 and Q2 2026, and $45.9 billion and $53.6 billion for the six months ended June 30, 2025 and 2026.

Shipping costs to receive products from our suppliers are included in our inventory and recognized as cost of sales upon sale of products to our customers.

We expect our cost of shipping to continue to increase to the extent our customers accept and use our shipping offers at an increasing rate, we use more expensive shipping methods, and we offer additional services.

We expect our cost of shipping to continue to increase to the

extent our customers accept and use our shipping offers at an increasing rate, we use more expensive shipping methods, and we offer additional services.

We seek to mitigate costs of shipping over time in part through achieving higher sales volumes, optimizing our fulfillment network, negotiating better terms with our suppliers, and achieving better operating efficiencies.

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Additionally, sales by our sellers have higher payment processing and related transaction costs as a percentage of net sales compared to our retail sales because payment processing costs are based on the gross purchase price of underlying transactions.

The increase in fulfillment costs in Q1 2026, compared to the comparable prior year period, is primarily due to increased sales and investments in our fulfillment network, partially offset by operational efficiencies.

Changes in foreign exchange rates increased fulfillment costs by $478 million for Q1 2026.

The increase in fulfillment costs in Q2 2026 and for the six months ended June 30, 2026, compared to the comparable prior year periods, is primarily due to increased sales and investments in our fulfillment network, partially offset by operational efficiencies.

Changes in foreign exchange rates did not significantly impact fulfillment costs for Q2 2026, but increased fulfillment costs by $523 million for the six months ended June 30, 2026.

We seek to expand our fulfillment network to accommodate a greater selection and in-stock inventory levels and to meet anticipated shipment volumes from sales of our own products as well as sales by third parties for which we provide the fulfillment services.

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These costs are allocated to segments based on usage.

The increase in technology and infrastructure costs in Q1 2026, compared to the comparable prior year period, is primarily due to an increase in spending on infrastructure, including depreciation and amortization.

Changes in foreign exchange rates increased technology and infrastructure costs by $374 million for Q1 2026.

The increase in technology and infrastructure costs in Q2 2026 and for the six months ended June 30, 2026, compared to the comparable prior year periods, is primarily due to an increase in spending on infrastructure, including depreciation and amortization.

Changes in foreign exchange rates did not significantly impact technology and infrastructure costs for Q2 2026, but increased technology and infrastructure costs by $427 million for the six months ended June 30, 2026.

Technology and infrastructure costs in Q2 2026 include net unrealized gains for energy contracts that are subject to derivative accounting, primarily related to AWS.

Fair value measurements for these contracts do not impact cash flows but may be material to technology and infrastructure costs in future periods due to the duration of these contracts and volatility inherent in valuation methods.

We currently expense the majority of the costs associated with the development of our satellite network for global broadband service (including production, launch, and payroll costs, and launch services deposits upon launch).

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To the extent there is increased or decreased competition for these traffic sources, or to the extent our mix of these channels shifts, we would expect to see a corresponding change in our marketing costs.

Sales and marketing costs in Q1 2026 did not significantly change compared to the comparable prior year period.

Changes in foreign exchange rates increased sales and marketing costs by $233 million for Q1 2026.

Sales and marketing costs in Q2 2026 and for the six months ended June 30, 2026 did not significantly change compared to the comparable prior year periods.

Changes in foreign exchange rates did not significantly impact sales and marketing costs for Q2 2026, but increased sales and marketing costs by $293 million for the six months ended June 30, 2026.

While costs associated with Amazon Prime membership benefits and other shipping offers are not included in sales and marketing expense, we view these offers as effective worldwide marketing tools, and intend to continue offering them indefinitely.

General and Administrative

General and administrative costs in Q1 2026 did not significantly change compared to the comparable prior year period.

The decrease in general and administrative costs in Q2 2026 and for the six months ended June 30, 2026, compared to the comparable prior year periods, is primarily due to a decrease in payroll and related expenses.

Other Operating Expense (Income), Net

Other operating expense (income), net was $308 million and $447 million for Q1 2025 and Q1 2026, and was primarily related to charges associated with damaged data centers in the Middle East in Q1 2026, asset impairments, and the amortization of intangible assets.

Other operating expense (income), net was $199 million and $90 million for Q2 2025 and Q2 2026, and $507 million and $537 million for the six months ended June 30, 2025 and 2026, and was primarily related to asset impairments and the amortization of intangible assets.

Operating Income

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Three Months Ended

June 30, Six Months Ended

2025 2026 2025 2026

Operating Income

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Consolidated $ 19,171 $ 27,461 $ 37,576 $ 51,313

Operating income increased from $18.4 billion in Q1 2025 to $23.9 billion in Q1 2026.

Operating income increased from $19.2 billion in Q2 2025 to $27.5 billion in Q2 2026, and increased from $37.6 billion for the six months ended June 30, 2025 to $51.3 billion for the six months ended June 30, 2026.

We believe that operating income is a more meaningful measure than gross profit and gross margin due to the diversity of our product categories and services.

For more information on the operating expenses that impact segment operating income, see “Operating Expenses” and the descriptions of operating expense line item changes on pages 30 to 32, and “Note 8 — Segment Information” on page 22.

The increase in North America operating income in Q1 2026, compared to the comparable prior year period, is primarily due to increased unit sales and increased advertising sales, partially offset by increased shipping, fulfillment, and technology and infrastructure costs.

The increase in International operating income in Q1 2026, compared to the comparable prior year period, is primarily due to increased unit sales and increased advertising sales, partially offset by increased shipping and fulfillment costs.

Changes in foreign exchange rates positively impacted operating income by $347 million for Q1 2026.

The increase in AWS operating income in Q1 2026, compared to the comparable prior year period, is primarily due to increased sales, partially offset by spending on technology infrastructure that was primarily driven by additional investments to support AWS business growth.

Changes in foreign exchange rates negatively impacted operating income by $339 million for Q1 2026.

The increase in North America operating income in Q2 2026 and for the six months ended June 30, 2026, compared to the comparable prior year periods, is primarily due to increased unit sales and increased advertising sales, partially offset by increased shipping, fulfillment, and technology and infrastructure costs.

The increase in International operating income in Q2 2026 and for the six months ended June 30, 2026, compared to the comparable prior year periods, is primarily due to increased unit sales and increased advertising sales, partially offset by increased shipping and fulfillment costs.

Changes in foreign exchange rates did not significantly impact operating income for Q2 2026, but positively impacted operating income by $304 million for the six months ended June 30, 2026.

The increase in AWS operating income in Q2 2026 and for the six months ended June 30, 2026, compared to the comparable prior year periods, is primarily due to increased sales, partially offset by spending on technology infrastructure that was primarily driven by additional investments to support AWS business growth.

Changes in foreign exchange rates did not significantly impact operating income for Q2 2026, but negatively impacted operating income by $395 million for the six months ended June 30, 2026.

Interest Income and Expense

Our interest income was $1.1 billion during Q1 2025 and Q1 2026, primarily due to a decrease in prevailing rates, offset by a higher average balance of invested funds.

Our interest income was $1.1 billion and $1.3 billion during Q2 2025 and Q2 2026, and $2.2 billion and $2.4 billion for the six months ended June 30, 2025 and 2026, primarily due to a higher average balance of invested funds, offset by a decrease in prevailing rates.

We generally invest our excess cash in investment grade short- to intermediate-term marketable debt securities and AAA-rated money market funds.

Our interest income corresponds with the average balance of invested funds based on the prevailing rates, which vary depending on the geographies and currencies in which they are invested.

Interest expense was $541 million and $800 million during Q1 2025 and Q1 2026, and was primarily related to debt and finance leases.

Interest expense was $516 million and $1.3 billion during Q2 2025 and Q2 2026, and $1.1 billion and $2.1 billion for the six months ended June 30, 2025 and 2026, and was primarily related to debt, including new issuances of Notes, and finance leases.

See Item 1 of Part I, “Financial Statements — Note 3 — Leases and Note 5 — Debt” for additional information.

Other Income (Expense), Net

Other income (expense), net was $2.7 billion and $15.6 billion during Q1 2025 and Q1 2026.

Other income (expense), net was $1.1 billion and $53.4 billion during Q2 2025 and Q2 2026, and $3.9 billion and $69.1 billion for the six months ended June 30, 2025 and 2026.

The primary components of other income (expense), net are related to equity securities valuations and adjustments, equity warrant valuations, foreign currency, and reclassification adjustments for gains (losses) on available-for-sale debt securities.

The net gain of $2.7 billion in Q1 2025 is primarily from the reclassification adjustment for the gain on available-for-sale debt securities from the portion of our convertible notes investments in Anthropic that were converted to nonvoting preferred stock during Q1 2025.

The net gain of $15.6 billion in Q1 2026 is primarily from an upward adjustment for observable changes in price relating to our nonvoting preferred stock in

Anthropic and the reclassification adjustment for the gains on available-for-sale debt securities from the portions of our convertible notes investments in Anthropic that were converted to nonvoting preferred stock during Q1 2026.

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.

The net gain of $1.1 billion in Q2 2025 is primarily from equity warrant valuations.

The net gain of $3.9 billion for the six months ended June 30, 2025 is primarily from the reclassification adjustment for the gain on available-for-sale debt securities from the portion of our convertible notes investments in Anthropic that were converted to nonvoting preferred stock during the three months ended March 31, 2025.

The net gain of $53.4 billion in Q2 2026 and $69.1 billion for the six months ended June 30, 2026 is primarily from upward adjustments for observable changes in price relating to our nonvoting preferred stock in Anthropic and the reclassification adjustment for the gains on available-for-sale debt securities from the portions of our convertible notes investments in Anthropic that were converted to nonvoting preferred stock during the three months ended March 31, 2026.

Our income tax provision for the six months ended June 30, 2025 was $7.2 billion, which included $753 million of net discrete tax benefits primarily attributable to excess tax benefits from stock-based compensation.

Our income tax provision for the six months ended June 30, 2026 was $27.8 billion, which included $15.9 billion of net discrete tax expense primarily attributable to the upward adjustments to our investments in Anthropic.

See Item 1 of Part I, “Financial Statements — Note 7 — Income Taxes” for additional information.

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We provide a free cash flow measure because we believe it provides additional perspective on the impact of acquiring property and equipment with cash.

Free cash flow is cash flow from operations reduced by “Purchases of property and equipment, net of proceeds from sales and incentives.” The following is a reconciliation of free cash flow to the most comparable GAAP cash flow measure, “Net cash provided by (used in) operating activities,” for the trailing twelve months ended March 31, 2025 and 2026 (in millions):

Twelve Months Ended

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For example, free cash flow does not incorporate the portion of payments representing principal reductions of debt or cash payments for business acquisitions.

Additionally, our mix of property and equipment acquisitions with cash or other financing options may change over time.

Additionally, our mix of property

and equipment acquisitions with cash or other financing options may change over time.

Therefore, we believe it is important to view free cash flow only as a complement to our entire consolidated statements of cash flows.

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Dollar is as follows (in millions):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2026 2025 2026

Reported Exchange

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Effect (1) At Prior

Reported Exchange

Effect (1) At Prior

Rates (2) As Reported Exchange

Effect (1) At Prior

Net sales $ 167,702 $ (1,515) $ 166,187 $ 200,606 $ (75) $ 200,531 $ 323,369 $ (75) $ 323,294 $ 382,125 $ (2,952) $ 379,173

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(2) Represents the outcome that would have resulted had foreign exchange rates in the reported period been the same as those in effect in the comparable prior year period for operating results.

We provided guidance on April 29, 2026, in our earnings release furnished on Form 8-K as set forth below.

These forward-looking statements reflect Amazon.com’s expectations as of April 29, 2026, and are subject to substantial uncertainty.

We provided guidance on July 30, 2026, in our earnings release furnished on Form 8-K as set forth below.

These forward-looking statements reflect Amazon.com’s expectations as of July 30, 2026, and are subject to substantial uncertainty.

Our results are inherently unpredictable and may be materially affected by many factors, such as fluctuations in foreign exchange rates and energy prices, changes in global economic and geopolitical conditions, tariff and trade policies, resource and supply volatility, including for memory chips, and customer demand and spending (including the impact of recessionary fears), inflation, interest rates, regional labor market constraints, world events, the rate of growth of the internet, online commerce, cloud services, and new and emerging technologies, as well as those outlined in Item 1A of Part II, “Risk Factors.”

Second Quarter 2026 Guidance

• Net sales are expected to be between $194.0 billion and $199.0 billion, or to grow between 16% and 19% compared with second quarter 2025.

Third Quarter 2026 Guidance

• Net sales are expected to be between $197.0 billion and $202.0 billion, or to grow between 9% and 12% compared with third quarter 2025.

Excluding the impact of Prime Day in both 2025 and 2026, third quarter 2026 year-over-year growth would be nearly 400 basis points higher.

This guidance anticipates an unfavorable impact of approximately 80 basis points from foreign exchange rates.

• Operating income is expected to be between $20.0 billion and $24.0 billion, compared with $19.2 billion in second quarter 2025.

• This guidance assumes that Prime Day occurs in second quarter 2026.

• This guidance assumes, among other things, that no additional business acquisitions, restructurings, or legal settlements are concluded.

• Operating income is expected to be between $22.5 billion and $26.5 billion, compared with $17.4 billion in third quarter 2025.

• This guidance assumes, among other things, no impact from energy derivative contract remeasurements, and that no additional business acquisitions, restructurings, or legal settlements are concluded.

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 2. Management’s Discussion and Analysis