Key Highlights

  • Amazon (NASDAQ:AMZN) reported second quarter 2026 net income of USD 62.6 billion, or USD 5.75 per diluted share, with non-operating income of USD 53.4 billion attributed primarily to its Anthropic investments.
  • AWS net sales rose 37% to USD 42.2 billion, an annualized run rate of USD 169 billion, within total net sales of USD 200.6 billion, up 20% from USD 167.7 billion.
  • Trailing twelve month purchases of property and equipment were USD 173.0 billion, and free cash flow was an outflow of USD 7.6 billion, against an inflow of USD 18.2 billion a year earlier.
  • Amazon (NASDAQ:AMZN) guided third quarter net sales to USD 197.0 billion to USD 202.0 billion and operating income to USD 22.5 billion to USD 26.5 billion, and reports on October 29, 2026.

Where the USD 53.4 Billion Came From

Amazon (NASDAQ:AMZN) released second quarter results on July 30, 2026. Operating income was USD 27.5 billion, up 43%, yet net income of USD 62.6 billion was more than double that, because non-operating other income of USD 53.4 billion was attributed to Anthropic. The mechanism is accounting: when Anthropic raises money at a higher valuation, Amazon marks up the value of its stake and records the gain in earnings without receiving cash. The chart shows Anthropic at USD 965 billion, far above the USD 350 billion pre-money valuation reported for Amazon's April 2026 investment. The size of the stake is not given in the material reviewed, so it cannot be tested here, and the gain depends on how the stake is carried.

The Anthropic Loop

In April 2026 Amazon was reported to commit up to USD 33 billion more to Anthropic, USD 5 billion of fresh equity and up to USD 20 billion tied to commercial milestones, on top of USD 8 billion invested in 2023 to 2025. Anthropic was reported to commit more than USD 100 billion to AWS over ten years for up to 5 gigawatts of capacity, including Trainium chips. Those are reported figures, not matched to a filing here. So Amazon funds a customer and books both a stake gain and cloud revenue from it. Nvidia (NASDAQ:NVDA) is also on the chart as a supplier and rival to Trainium, so Anthropic can split its spending across chip vendors, which is a form of diversification the loop does not remove.

Risks and What to Watch

The gain is non-cash and can reverse if the valuation falls, while capital spending is real cash. Net income of USD 62.6 billion therefore overstates what the business generated in the quarter. Free cash flow turned negative on a trailing basis as capex reached USD 173.0 billion. Anthropic's compute needs depend on its own funding, and the Trainium chips needed for 5 gigawatts were reported as not all fabricated yet. Watch AWS growth against 37%, capex, any further Anthropic gains and results from Alphabet (NASDAQ:GOOGL), which competes for the same customer, after the close on October 29, 2026, when a consensus of USD 2.01 per share was listed against USD 1.95 a year earlier.

Where Things Stand

Amazon (NASDAQ:AMZN) booked USD 53.4 billion because Anthropic's valuation rose on funding rounds in which Amazon also participates, and an accounting rule marks Amazon's stake to that price. The cloud growth of 37% is real, but a large part of the quarter's profit is an unrealized gain on a customer. The October 29, 2026 report will show how much of the loop is cash and how much is valuation.