Amazon Com Inc
AMZN10-Q,quarter ended Sep 30, 2025,filed Oct 31, 2025,Original on SEC EDGAR
3 of 3 checkable figures matched the company’s XBRL, 0 of 4 risk excerpts located in the filing text, 4 withheld
The Print
Amazon reported Q3 2025 net income of $21.2B ($1.95 diluted EPS) on net sales of $180.2B, up 13.4% from $158.9B a year earlier, while operating income was essentially flat at $17.4B.
Net sales increased 13% in Q3 2025 compared to the comparable prior year period, which management attributes to increased unit sales, including sales by third-party sellers, advertising sales, and subscription services, and, for AWS, increased customer usage partially offset by pricing changes primarily driven by long-term customer contracts. Operating income was $17.4B in Q3 2024 and Q3 2025, with Q3 2025 including charges of $2.5B related to the settlement of a lawsuit with the FTC and $1.8B of estimated severance costs primarily related to planned role eliminations. Net income rose to $21.2B from $15.3B, primarily reflecting the $10.2B of other income (expense), net in Q3 2025.
- Net sales rose 13.4% YoY to $180.2B, with AWS up 20% and International up 14%; changes in foreign exchange rates increased net sales by $1.5B for Q3 2025.
- Net income rose 38.2% YoY to $21.2B, driven by $10.2B of other income (expense), net, primarily from an upward adjustment for observable changes in price relating to nonvoting preferred stock in Anthropic and reclassification adjustments for gains on available-for-sale debt securities.
- Operating income was $17.4B in both Q3 2024 and Q3 2025; Q3 2025 includes charges of $2.5B related to the settlement of a lawsuit with the FTC and $1.8B of estimated severance costs primarily related to planned role eliminations.
- Operating cash flow rose to $35.5B from $26.0B, while cash capital expenditures rose to $34.2B from $21.3B, leaving trailing-twelve-month free cash flow of $14.8B versus $47.7B a year earlier.
Results That Matter
- Total net sales
- Current period
- $180.2B
- Prior period
- $158.9B
- Change
- +13.4%
Management attributes the increase primarily to increased unit sales, including sales by third-party sellers, advertising sales, and subscription services; changes in foreign exchange rates increased net sales by $1.5B for Q3 2025. - Operating income
- Current period
- $17.4B
- Prior period
- $17.4B
- Change
- +0.1%
Q3 2025 operating income includes charges of $2.5B related to the settlement of a lawsuit with the FTC and $1.8B of estimated severance costs primarily related to planned role eliminations. - Net income
- Current period
- $21.2B
- Prior period
- $15.3B
- Change
- +38.2%
The increase primarily reflects other income (expense), net of $10.2B in Q3 2025, primarily from an upward adjustment for observable changes in price relating to nonvoting preferred stock in Anthropic and reclassification adjustments for gains on available-for-sale debt securities. - Diluted earnings per share
- Current period
- $1.95
- Prior period
- $1.43
- Change
- +36.4%
Diluted EPS rose alongside net income; weighted-average diluted shares were 10,845M versus 10,735M. - Basic earnings per share
- Current period
- $1.98
- Prior period
- $1.46
- Change
- +35.6%
Basic EPS rose alongside net income; weighted-average basic shares were 10,674M versus 10,501M.
| Metric | Current Period | Prior Period | Change | Investor Takeaway |
|---|---|---|---|---|
Total net sales | $180.2B | $158.9B | +13.4% | Management attributes the increase primarily to increased unit sales, including sales by third-party sellers, advertising sales, and subscription services; changes in foreign exchange rates increased net sales by $1.5B for Q3 2025. |
Operating income | $17.4B | $17.4B | +0.1% | Q3 2025 operating income includes charges of $2.5B related to the settlement of a lawsuit with the FTC and $1.8B of estimated severance costs primarily related to planned role eliminations. |
Net income | $21.2B | $15.3B | +38.2% | The increase primarily reflects other income (expense), net of $10.2B in Q3 2025, primarily from an upward adjustment for observable changes in price relating to nonvoting preferred stock in Anthropic and reclassification adjustments for gains on available-for-sale debt securities. |
Diluted earnings per share | $1.95 | $1.43 | +36.4% | Diluted EPS rose alongside net income; weighted-average diluted shares were 10,845M versus 10,735M. |
Basic earnings per share | $1.98 | $1.46 | +35.6% | Basic EPS rose alongside net income; weighted-average basic shares were 10,674M versus 10,501M. |
What changed
Quarter over quarter, against the 10-Q for the quarter ended Jun 30, 2025.
Prior 10-QRevenue up 13.4%; Net income up 38.2%
| Metric | Prior | Current | Change | Read as |
|---|---|---|---|---|
| Revenue | $158.9B | $180.2B | +13.4% | Favorable |
| Net income | $15.3B | $21.2B | +38.2% | Favorable |
| EPS | $1.46 | $1.98 | +35.6% | Favorable |
- Revenue+13.4%Prior $158.9B, current $180.2BFavorable
- Net income+38.2%Prior $15.3B, current $21.2BFavorable
- EPS+35.6%Prior $1.46, current $1.98Favorable
▲ and ▼ show the direction of each change. Color and “Read as” show whether that direction is usually favorable for the metric.
Earnings Quality & Cash Conversion
Operating income was $17.4B in Q3 2024 and Q3 2025; Q3 2025 includes charges of $2.5B related to the settlement of a lawsuit with the FTC, recorded in "Other operating expense (income), net" and impacting the North America segment, and $1.8B of estimated severance costs primarily related to planned role eliminations, recorded primarily in "Technology and infrastructure," "Sales and marketing," and "General and administrative" and impacting all segments. Net income of $21.2B includes other income (expense), net of $10.2B, primarily from an upward adjustment for observable changes in price relating to nonvoting preferred stock in Anthropic and reclassification adjustments for gains on available-for-sale debt securities. The filing does not define an adjusted or ex-item earnings total.
Operating cash flow was 1.7x net income attributable to the parent (cash conversion); free cash flow of $430.0M (derived as operating cash flow minus the absolute selected capex cash-flow amount; not an issuer-defined or discretionary-cash measure).
Value Drivers & Capital Allocation
Capital expenditures $35.1B (prior $22.6B) (selected cash-flow amount, not necessarily total capital investment).
Financing cash flow for 2025-07-01 to 2025-09-30 was an outflow of $44,000,000, compared with an outflow of $2,758,000,000 for 2024-07-01 to 2024-09-30. Both periods had net outflows.
Period net income attributable to the parent / period-end equity, not annualized: 5.7% (prior at 2024-09-30: 5.9%); period net income attributable to the parent / period-end assets, not annualized: 2.9%.
Forward Signals
Fourth Quarter 2025 Guidance: Net sales are expected to be between $206.0 billion and $213.0 billion, or to grow between 10% and 13% compared with fourth quarter 2024, anticipating a favorable impact of approximately 190 basis points from foreign exchange rates; operating income is expected to be between $21.0 billion and $26.0 billion, compared with $21.2 billion in fourth quarter 2024; the guidance assumes that no additional business acquisitions, restructurings, or legal settlements are concluded.
Known trends
- Macroeconomic factors, including changes in inflation and interest rates, global economic and geopolitical developments, including unpredictable shifts in global tariff and trade policies, and the development and adoption of technologies and services, including artificial intelligence, have direct and indirect impacts on our results of operations that are difficult to predict, isolate, and quantify.
- We expect spending in technology and infrastructure to increase over time as we continue to add employees and infrastructure.
- 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.
Subsequent events
- On October 29, 2025, Amazon.com, Inc., Citibank N.A., as administrative agent, and the lenders party thereto entered into a 364-day revolving credit agreement (the "2025 Short-Term Credit Agreement"), replacing the prior $5.0 billion 364-day revolving credit agreement, providing an unsecured revolving credit facility with a borrowing capacity of up to $5.0 billion.
“Net sales are expected to be between $206.0 billion and $213.0 billion, or to grow between 10% and 13% compared with fourth quarter 2024.”
— Amazon.com, Inc. (Fourth Quarter 2025 Guidance)
“Operating income is expected to be between $21.0 billion and $26.0 billion, compared with $21.2 billion in fourth quarter 2024.”
— Amazon.com, Inc. (Fourth Quarter 2025 Guidance)
Risks
Source-verified risk excerpts are unavailable. Review the filing. 4 items withheld because the evidence could not be matched. Selected excerpts are not a complete risk inventory.
Segments
| Segment | Revenue | Operating Income | Revenue Change | Commentary |
|---|---|---|---|---|
| North America | $106.3B | $4.8B | +11.2% | Management attributes the sales growth primarily to increased unit sales, including sales by third-party sellers, advertising sales, and subscription services, driven largely by continued focus on price, selection, and convenience, including fast shipping offers; the segment's operating income decrease is attributed to increased other operating, fulfillment, technology and infrastructure, and shipping costs, inclusive of the FTC settlement and severance costs, partially offset by increased unit sales and advertising sales. |
| International | $40.9B | $1.2B | +14.0% | Management attributes the sales growth primarily to increased unit sales, including sales by third-party sellers, advertising sales, and subscription services; the segment's operating income decrease is attributed to increased shipping and fulfillment costs, inclusive of severance costs, partially offset by increased unit sales and advertising sales. |
| AWS | $33.0B | $11.4B | +20.2% | Management attributes the sales growth primarily to increased customer usage, partially offset by pricing changes primarily driven by long-term customer contracts; the segment's operating income increase is attributed to increased sales, partially offset by spending on technology infrastructure primarily driven by additional investments to support AWS business growth and severance costs. |
Balance Sheet & Liquidity
Leverage: Identified debt as of 2025-09-30 (carrying amount): long-term debt including current maturities of $55.1B; noncurrent long-term debt of $50.7B; current portion of long-term debt of $4.0B; short-term borrowings of $220.0M. The reported scopes overlap; no non-overlapping subtotal is established. Total debt, net debt and debt-to-equity are therefore not stated.
Liquidity: Cash, cash equivalents, and marketable securities at fair value were $94.2B as of September 30, 2025, down from $101.2B as of December 31, 2024; amounts held in foreign currencies were $20.4B. Amazon had no borrowings outstanding under the two unsecured revolving credit facilities or the commercial paper programs as of September 30, 2025, and had $10.6B of unused letters of credit.
Cash flow: Cash flow — operating $35.5B, investing $-26.1B, financing $-44.0M.
Working capital: Current assets $196.9B vs. current liabilities $195.2B (current ratio 1.01x). Prior reported balance sheet as of 2024-12-31: $190.9B vs. $179.4B (1.06x).
Maturities & covenants
- Long-term debt principal and interest commitments total $82.9B, with $1.9B due in the three months ending December 31, 2025 and $4.5B due in 2026.
- We are not subject to any financial covenants under the Notes.
- The 2025 Short-Term Credit Agreement contains customary representations and warranties, covenants, and events of default, but does not contain financial covenants.
Notable Footnotes
| Item | Impact |
|---|---|
| Change in estimated useful lives of servers and networking equipment | Effective January 1, 2025, Amazon changed its estimate of the useful lives of a subset of servers and networking equipment from six years to five years; the effect for Q3 2025 was an increase in depreciation and amortization expense of $392M and a reduction in net income of $298M, or $0.03 per basic and diluted share, primarily impacting the AWS segment. |
| Anthropic investments | As of September 30, 2025, the amount recorded for nonvoting preferred stock was approximately $14.8B, the estimated fair value of convertible notes was approximately $23.7B, and the associated unrealized gain included in accumulated other comprehensive income (loss) was $18.8B; Amazon will invest an additional $1.4B in another convertible note in Q4 2025. |
| AWS performance obligations | Commitments not yet recognized for contracts with original terms exceeding one year were approximately $200B as of September 30, 2025, with a weighted-average remaining life of 3.8 years. |
| Income taxes | The One Big Beautiful Bill Act of 2025 increased Amazon's 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 cash taxes in 2025; the income tax provision for the nine months ended September 30, 2025 was $14.1B, including $354M of net discrete tax expense primarily attributable to net gains from investments in Anthropic. |
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