We have prepared the accompanying consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These consolidated financial statements are unaudited and, in our opinion, include all adjustments, consisting of normal recurring adjustments and accruals necessary for a fair presentation of our consolidated cash flows, operating results, and balance sheets for the periods presented. Operating results for the periods presented are not necessarily indicative of the results that may be expected for 2025 due to seasonal and other factors. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted in accordance with the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes in Item 8 of Part II, “Financial Statements and Supplementary Data,” of our 2024 Annual Report on Form 10-K.

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. Intercompany balances and transactions between consolidated entities are eliminated.

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, and the determination of when to capitalize certain costs relating to new products or service offerings. 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 Q2 2025, based on servers and networking equipment that were included in “Property and equipment, net” as of March 31, 2025 and those acquired during the three months ended June 30, 2025, was an increase in depreciation and amortization expense of $280 million and a reduction in net income of $217 million, or $0.02 per basic share and $0.02 per diluted share, which primarily impacted our AWS segment. The effect of this change in estimate for the six months ended June 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 six months ended June 30, 2025, was an increase in depreciation and amortization expense of $497 million and a reduction in net income of $379 million, or $0.04 per basic share and $0.04 per diluted share, which primarily impacted our AWS segment.


	Three Months Ended June 30,				Six Months Ended June 30,				Twelve Months Ended June 30,
	2024		2025		2024		2025		2024		2025
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest on debt, net of capitalized interest	$	680	$	523	$	949	$	759	$	2,201	$	1,668
Cash paid for operating leases	2,844		3,758		6,176		7,320		11,634		13,485
Cash paid for interest on finance leases	72		72		146		143		296		284
Cash paid for interest on financing obligations	50		52		114		107		210		212
Cash paid for income taxes, net of refunds	5,700		4,761		6,158		5,638		12,983		11,788
Assets acquired under operating leases	3,911		4,621		7,664		8,942		13,986		16,702
Property and equipment acquired under finance leases, net of remeasurements and modifications	181		937		223		991		617		1,622
Increase (decrease) in property and equipment acquired but not yet paid	2,760		(1,600)		3,171		1,508		3,791		5,376

Basic earnings per share is calculated using our weighted-average outstanding common shares. Diluted earnings per share is calculated using our weighted-average outstanding common shares including the dilutive effect of stock awards as determined under the treasury stock method. In periods when we have a net loss, stock awards are excluded from our calculation of earnings per share as their inclusion would have an antidilutive effect.


	Three Months Ended June 30,		Six Months Ended June 30,
	2024	2025	2024	2025
Shares used in computation of basic earnings per share	10,447	10,637	10,420	10,620
Total dilutive effect of outstanding stock awards	261	169	269	180
Shares used in computation of diluted earnings per share	10,708	10,806	10,689	10,800


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2025		2024		2025
Marketable equity securities valuation gains (losses)	$	443	$	388	$	(1,683)	$	250
Equity warrant valuation gains (losses)	(271)		590		(501)		212
Reclassification adjustment for gains (losses) on available-for-sale debt securities	(4)		22		(5)		3,285
Upward adjustments relating to equity investments in private companies	6		49		11		86
Foreign currency gains (losses)	(138)		70		(212)		68
Other, net	(54)		(2)		(301)		(35)
Total other income (expense), net	$	(18)	$	1,117	$	(2,691)	$	3,866

The marketable equity securities valuation gain (loss) of $443 million and $388 million in Q2 2024 and Q2 2025, and $(1.7) billion and $250 million for the six months ended June 30, 2024 and 2025 is primarily from our equity investment in Rivian Automotive, Inc. (“Rivian”). The reclassification adjustment for the gain on available-for-sale debt securities of $3.3 billion for the six months ended June 30, 2025 is primarily from the portion of our convertible notes investments in Anthropic, PBC (“Anthropic”) that were converted to nonvoting preferred stock during the three months ended March 31, 2025.

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 $2.8 billion as of December 31, 2024 and June 30, 2025.

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 June 30, 2025, customer receivables, net, were $34.3 billion and $36.6 billion, vendor receivables, net, were $11.6 billion and $10.6 billion, and other receivables, net, were $3.4 billion and $3.5 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 $6.7 billion as of December 31, 2024 and June 30, 2025. We currently expense satellite network launch services deposits upon launch to “Technology and infrastructure.”

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 June 30, 2025 were $19.6 billion and $20.4 billion. Total video and music expense was $4.6 billion and $5.1 billion in Q2 2024 and Q2 2025, and $9.2 billion and $10.2 billion for the six months ended June 30, 2024 and 2025.

Unearned revenue is recorded when payments are received or due in advance of performing our service obligations and is recognized over the service period. 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 $11.4 billion was recognized as revenue during the six months ended June 30, 2025. Included in “Other long-term liabilities” on our consolidated balance sheets was $6.5 billion and $4.3 billion of unearned revenue as of December 31, 2024 and June 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 $195 billion as of June 30, 2025. The weighted-average remaining life of our long-term contracts is 4.0 years. However, the amount and timing of revenue recognition is largely driven by customer usage, which can extend beyond the original contractual term.

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. The ASU is effective for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The amendments can be applied on either a prospective or retroactive basis. We are currently evaluating the ASU to determine its impact on our disclosures.