Amazon’s Earnings Miss Almost Exactly Equals Its New Debt Bill

Amazon.com Inc. (NASDAQ:AMZN) ran a more profitable business last quarter than Wall Street expected, though earnings per share still fell short. The difference between the two results traces back to one line on the income statement: interest.

• AMZN stock is down after earnings. See the chart and price action here. 

The Seattle-based company’s operating profit beat forecasts by about $1.8 billion. Even so, EPS landed at $1.89, below the $1.96 analysts had penciled in. A 7-cent miss in a quarter where the core business outperformed calls for a closer look below the operating line.

Amazon paid $1.69 billion in interest during the third quarter, according to its earnings release. A year earlier, the figure was $538 million. Interest income also rose modestly to $1.19 billion from $1.1 billion.

In the third quarter of 2025, Amazon earned $562 million more in interest than it paid. One year later, in the third quarter of 2026, it paid $504 million more than it earned. The net change comes to roughly $1.07 billion.

Applying a tax rate of about 23% shrinks the swing to around $820 million after tax. Spread across Amazon’s share count, the hit works out to about 7.5 cents per share. The reported miss was 7 cents.

The match suggests the business itself held up. Amazon generated more operating profit than forecast, then sent a larger slice of it to lenders before anything reached shareholders. Interest sits below operating income on the income statement, so a beat at the operating line can vanish by the time results reach the bottom line.

Debt More Than Doubles in 9 Months

Long-term debt climbed from $65.6 billion in December to $173.1 billion at the end of September, per the same release. Debt more than doubled in nine months. Much of the money is going toward AI data centers, which Amazon views as essential to meeting demand at Amazon Web Services.

Bigger debt carries a predictable cost. Each new bond adds to the quarterly interest bill, and the bill comes due whether or not the data centers it funded are producing revenue yet.

Amazon has tried to cap the near-term buildup. In July, the company said it would not borrow again in 2026, CNBC reported. The pledge accompanied a large bond sale tied to AI spending.

A 2026 Borrowing Pause Meets a Bigger 2027 Budget

Amazon expects 2027 capital spending to be "meaningfully more" than the roughly $220 billion it plans to spend in 2026. 

Funding a larger outlay could send Amazon back to the bond market once the calendar turns. The company has already shown it will borrow to close the gap between the cash it generates and the cash it spends. Fresh debt in 2027 would push the interest line higher again, and the cost would show up in the same place it did this quarter.

The third quarter report offers a useful template for investors. Amazon’s operating business can keep beating expectations while EPS lags, as long as interest costs rise faster than interest income.

The spread between those two lines may say more about Amazon’s per-share earnings next year than the headline profit figures.

Short of a slowdown in AI spending, Amazon’s debt bill is likely to keep growing. Wall Street may need to start modeling it as closely as it models AWS.

AMZN Stock Price Activity: Amazon stock was down 6.72% at $227.40 during premarket trading Friday, according to Benzinga Pro market data.

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