Amazon.com AMZN · USD

SEGMENT INFORMATIONWe have organized our operations into three segments: North America, International, and AWS. We allocate to segment results the operating expenses “Fulfillment,” “Technology and infrastructure,” “Sales and marketing,” and “General and administrative” based on usage, which is generally reflected in the segment in which the costs are incurred. The majority of technology costs recorded in “Technology and infrastructure” are incurred in the U.S. and are included in our North America and AWS segments. The majority of infrastructure costs recorded in “Technology and infrastructure” are allocated to the AWS segment based on usage. There are no internal revenue transactions between our reportable segments. Our chief operating decision maker (“CODM”) is our President and Chief Executive Officer. Our CODM regularly reviews consolidated net sales, consolidated operating expenses, and consolidated operating income (loss) by segment. Amounts included in consolidated operating expenses include “Cost of sales,” “Fulfillment,” “Technology and infrastructure,” “Sales and marketing,” “General and administrative,” and “Other operating expense (income), net.” Our CODM manages our business primarily by reviewing consolidated results by segment on a quarterly basis, and using those results along with forecasts and other non-financial information in our annual budgeting process.North AmericaThe North America segment primarily consists of amounts earned from retail sales of consumer products (including from sellers) and advertising and subscription services through North America-focused online and physical stores. This segment includes export sales from these online stores.InternationalThe International segment primarily consists of amounts earned from retail sales of consumer products (including from sellers) and advertising and subscription services through internationally-focused online stores. This segment includes export sales from these internationally-focused online stores (including export sales from these online stores to customers in the U.S., Mexico, and Canada), but excludes export sales from our North America-focused online stores.AWSThe AWS segment consists of amounts earned from global sales of compute, storage, database, and other services for start-ups, enterprises, government agencies, and academic institutions.

COMMITMENTS AND CONTINGENCIESCommitmentsThe following summarizes our principal contractual commitments, excluding open orders for purchases that support normal operations and are generally cancellable, as of December 31, 2025 (in millions): Year Ended December 31, 20262027202820292030ThereafterTotalLong-term debt principal and interest$5,201 $11,250 $6,891 $4,993 $6,381 $73,486 $108,202 Operating lease liabilities15,380 13,186 12,140 10,911 9,710 45,587 106,914 Finance lease liabilities, including interest1,838 1,626 1,726 1,285 1,122 7,320 14,917 Financing obligations, including interest (1)577 582 592 601 612 6,651 9,615 Leases not yet commenced5,808 9,103 6,420 6,571 6,738 61,733 96,373 Unconditional purchase obligations (2)19,906 8,934 7,195 6,658 6,602 35,477 84,772 Other commitments (3)2,956 1,578 1,120 1,000 988 11,226 18,868 Total commitments$51,666 $46,259 $36,084 $32,019 $32,153 $241,480 $439,661 ___________________(1)Includes non-cancellable financing obligations for fulfillment network and data center facilities. Excluding interest, current financing obligations of $312 million and $358 million are recorded within “Accrued expenses and other” and $7.1 billion and $7.8 billion are recorded within “Other long-term liabilities” as of December 31, 2024 and 2025. The weighted-average remaining term of the financing obligations was 16.1 years and 15.0 years and the weighted-average imputed interest rate was 3.1% and 2.9% as of December 31, 2024 and 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 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. Energy agreements based on actual generation without a fixed or minimum volume commitment are not included. Certain of our energy agreements also provide the right to receive energy certificates.

DEBTAs of December 31, 2025, we had $68.0 billion of unsecured senior notes outstanding (the “Notes”), including $15.0 billion issued in November 2025 for general corporate purposes. Our total long-term debt obligations are as follows (in millions):Maturities (1)Stated Interest RatesEffective Interest RatesDecember 31, 2024December 31, 20252014 Notes issuance of $6.0 billion2034 - 20444.80% - 4.95%4.93% - 5.12%$2,750 $2,750 2017 Notes issuance of $17.0 billion2027 - 20573.15% - 4.25%3.25% - 4.33%13,000 12,000 2020 Notes issuance of $10.0 billion2027 - 20601.20% - 2.70%1.26% - 2.77%9,000 7,750 2021 Notes issuance of $18.5 billion2026 - 20611.00% - 3.25%1.14% - 3.31%15,000 15,000 April 2022 Notes issuance of $12.8 billion2027 - 20623.30% - 4.10%3.40% - 4.15%11,250 9,750 December 2022 Notes issuance of $8.3 billion2027 - 20324.55% - 4.70%4.61% - 4.74%7,000 5,750 2025 Notes issuance of $15.0 billion2028 - 20653.90% - 5.55%3.99% - 5.62%— 15,000 Other long-term debt— 836 Total face value of long-term debt58,000 68,836 Unamortized discount and issuance costs, net(360)(440)Less: current portion of long-term debt(5,017)(2,748)Long-term debt$52,623 $65,648 ___________________(1)The weighted-average remaining lives of the 2014, 2017, 2020, 2021, April 2022, December 2022, and 2025 Notes were 14.4, 15.4, 18.1, 13.2, 13.8, 4.4, and 15.6 years as of December 31, 2025. The combined weighted-average remaining life of the Notes was 14.1 years as of December 31, 2025.Interest on the Notes is payable semi-annually in arrears. We may redeem the Notes at any time in whole, or from time to time, in part at specified redemption prices. We are not subject to any financial covenants under the Notes. The estimated fair value of the Notes was approximately $50.2 billion and $61.1 billion as of December 31, 2024 and 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. There were $682 million of borrowings outstanding under the Credit Facility as of December 31, 2023, which had an interest rate of 6.6%.

INCOME TAXESIn 2023, 2024, and 2025, we recorded a net tax provision of $7.1 billion, $9.3 billion, and $19.1 billion. Our U.S. taxable income is reduced by accelerated depreciation deductions and the resulting U.S. tax liability is reduced by tax credits, primarily related to the U.S. federal research and development credit. Cash paid for income taxes, net of refunds, was $11.2 billion, $12.3 billion, and $8.3 billion for 2023, 2024, and 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. For 2025, the 2025 Tax Act increased our income tax provision, primarily due to a decrease in the foreign income deduction, and significantly decreased our cash taxes.The components of cash paid for income taxes, net of refunds, are as follows (in millions): Year Ended December 31,202320242025U.S. Federal$7,435 $7,630 $2,751 U.S. State2,070 2,450 2,125 International1,674 2,228 3,419 Total cash taxes paid, net of refunds$11,179 $12,308 $8,295 Certain foreign subsidiary earnings and losses are subject to current U.S. taxation and the subsequent repatriation of those earnings is not subject to tax in the U.S. The components of the provision for income taxes, net are as follows (in millions): Year Ended December 31,202320242025U.S. Federal:Current$8,652 $9,039 $1,220 Deferred(5,505)(4,101)11,134 Total3,147 4,938 12,354 U.S. State:Current2,158 2,109 2,067 Deferred(498)(453)984 Total1,660 1,656 3,051 International:Current2,186 2,765 4,330 Deferred127 (94)(648)Total2,313 2,671 3,682 Provision for income taxes, net$7,120 $9,265 $19,087 U.S. and international components of income before income taxes are as follows (in millions): Year Ended December 31, 202320242025U.S.$32,328 $61,947 $89,537 International5,229 6,667 7,774 Income before income taxes$37,557 $68,614 $97,311 The items accounting for differences between income taxes computed at the federal statutory rate and the provision recorded for income taxes are as follows (in millions, except percentages): Year Ended December 31, 202320242025Income taxes computed at the federal statutory rate$7,887 21.0 %$14,409 21.0 %$20,435 21.

LEASESWe 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 $55.6 billion as of December 31, 2024 and 2025. Accumulated amortization associated with finance leases was $41.8 billion and $40.4 billion as of December 31, 2024 and 2025. Lease cost recognized in our consolidated statements of operations is summarized as follows (in millions): Year Ended December 31,202320242025Operating lease cost$10,550 $11,961 $14,006 Finance lease cost:Amortization of lease assets5,899 3,866 3,284 Interest on lease liabilities304 285 312 Finance lease cost6,203 4,151 3,596 Variable lease cost2,165 2,465 2,694 Total lease cost$18,918 $18,577 $20,296 Other information about lease amounts recognized in our consolidated financial statements is as follows: December 31, 2024December 31, 2025 Weighted-average remaining lease term – operating leases10.6 years10.0 yearsWeighted-average remaining lease term – finance leases11.9 years12.6 yearsWeighted-average discount rate – operating leases3.5 %3.7 %Weighted-average discount rate – finance leases3.0 %3.

ACQUISITIONS, GOODWILL, AND ACQUIRED INTANGIBLE ASSETS2023 Acquisition Activity On February 22, 2023, we acquired 1Life Healthcare, Inc. (One Medical), for cash consideration of approximately $3.5 billion, net of cash acquired, to provide healthcare options for customers. The acquired assets primarily consist of $1.3 billion of intangible assets and $2.5 billion of goodwill, which is allocated to our North America segment.During 2023, we also completed acquisition activity for immaterial aggregate cash consideration, net of cash acquired.2024 Acquisition Activity During 2024, we completed acquisition activity for aggregate cash consideration of $780 million, net of cash acquired.2025 Acquisition Activity During 2025, we completed acquisition activity for immaterial aggregate cash consideration, net of cash acquired.The primary reasons for these transactions were to acquire technologies and know-how to enable Amazon to serve customers more effectively or to expand our customer base.Pro forma results of operations have not been presented because the effects of the 2025 transactions, individually and in the aggregate, were not material to our consolidated results of operations. Transaction-related costs were expensed as incurred and were not significant.GoodwillThe goodwill resulting from the acquisition activity is primarily related to expected improvements in technology performance and functionality, as well as sales growth from future product and service offerings and new customers, together with certain intangible assets that do not qualify for separate recognition. The goodwill resulting from the acquisition activity is generally not deductible for tax purposes. The following summarizes our goodwill activity in 2024 and 2025 by segment (in millions):NorthAmericaInternationalAWSConsolidatedGoodwill - January 1, 2024$19,126 $2,412 $1,251 $22,789 Acquisition activity191 77 52 320 Other adjustments (1)(28)(4)(3)(35)Goodwill - December 31, 202419,289 2,485 1,300 23,074 Acquisition activity25 85 2 112 Other adjustments (1)49 8 30 87 Goodwill - December 31, 2025$19,363 $2,578 $1,332 $23,273 ___________________(1)Primarily includes changes in foreign exchange rates.Intangible AssetsAcquired identifiable intangible assets are valued primarily by using discounted cash flows.

We have a unified and centrally-coordinated team, led by our chief security officer, that is responsible for implementing and maintaining centralized cybersecurity and data protection practices at Amazon in close coordination with senior leadership and other teams across Amazon. Reporting to our chief security officer are a number of experienced chief information security officers responsible for various parts of our business, including AWS, each of whom is supported by a team of trained cybersecurity professionals. In addition to our extensive in-house cybersecurity capabilities, at times we also engage assessors, consultants, auditors, or other third parties to assist with assessing, identifying, and managing cybersecurity risks. Our cybersecurity risks and associated mitigations are evaluated by senior leadership, including as part of our enterprise risk assessments that are reviewed by the Audit Committee and our Board of Directors. Such risks and mitigations are also subject to oversight by the Security Committee of our Board of Directors. Additional information about cybersecurity risks we face is discussed in Item 1A of Part I, “Risk Factors,” under the heading “We Could Be Harmed by Data Loss or Other Security Incidents,” which should be read in conjunction with the information above.The Security Committee, which is comprised of independent directors, oversees our policies and procedures for protecting our cybersecurity infrastructure and for compliance with applicable data protection and security regulations, and related risks. The Security Committee receives reports regarding such risks from management, including our chief security officer, and reports to the Board at least annually. The Security Committee also oversees the Board’s response to any significant cybersecurity incidents.

STOCKHOLDERS’ EQUITYPreferred StockWe have authorized 500 million shares of $0.01 par value preferred stock. No preferred stock was outstanding for any year presented.Common StockCommon shares outstanding plus shares underlying outstanding stock awards totaled 10.8 billion, 10.9 billion, and 11.0 billion, as of December 31, 2023, 2024, and 2025. These totals include all vested and unvested stock awards outstanding, including those awards we estimate will be forfeited.Stock Repurchase ActivityIn 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 in 2023, 2024, or 2025. As of December 31, 2025, we have $6.1 billion remaining under the repurchase program.Stock Award PlansEmployees vest in restricted stock unit awards over the corresponding service term, generally between two and five years. 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 ActivityStock-based compensation expense is as follows (in millions):Year Ended December 31,202320242025Cost of sales$836 $838 $777 Fulfillment3,090 2,973 2,703 Technology and infrastructure13,434 12,150 10,871 Sales and marketing4,623 4,084 3,445 General and administrative2,040 1,966 1,671 Total stock-based compensation expense (1)$24,023 $22,011 $19,467 ___________________(1)The related tax benefits were $5.4 billion, $5.0 billion, and $4.4 billion for 2023, 2024, and 2025. The following table summarizes our restricted stock unit activity (in millions):Number of UnitsWeighted AverageGrant-DateFair ValueOutstanding as of January 1, 2023384.4 $144 Units granted218.1 106 Units vested(139.9)143 Units forfeited(56.8)135 Outstanding as of December 31, 2023405.8 125 Units granted126.9 183 Units vested(209.7)132 Units forfeited(39.9)133 Outstanding as of December 31, 2024283.1 145 Units granted112.9 200 Units vested(138.1)135 Units forfeited(35.4)157 Outstanding as of December 31, 2025222.5 178 Scheduled vesting for outstanding restricted stock units as of December 31, 2025, is as follows (in millions): Year Ended 20262027202820292030ThereafterTotalScheduled vesting — restricted stock units110.4 69.9 30.7 9.8 0.8 0.9 222.5 As of December 31, 2025, there was $16.