Amazon’s Anthropic Stake Made 43% of Its 2026 Pretax Profit

Amazon recorded about $62.8 billion of upward adjustments to its Anthropic nonvoting preferred stock in the first nine months of 2026, its third-quarter 10-Q shows. That is 42.6% of the $147.6 billion Amazon earned before income taxes in the same nine months, by our arithmetic.

Amazon is the largest holder in Anthropic’s IPO, with 14.7% of the shares, as we reported on 11 November. Its pretax income more than doubled from $70.7 billion a year earlier; without the Anthropic preferred markups in both years, the rise is 33.5%, by our arithmetic.

Business Pill · Year-over-Year

A short explainer on year-over-year growth and the question it always raises: compared with what? It teaches the general idea only and does not discuss Amazon or Anthropic.

What the 10-Q Records

The 10-Q says Amazon recorded upward adjustments of “$ 7.2 billion and $ 62.8 billion for the nine months ended September 30, 2025 and 2026” to its nonvoting preferred stock, in other income, “to reflect observable changes in price related to Anthropic’s fundings”.

Other income (expense), net was $68.4 billion for the nine months, against $14.1 billion a year earlier. Operating income was $79.4 billion, up 44.3%, by our arithmetic. Income before income taxes was $147.6 billion, against $70.7 billion: up 108.7%.

The $62.8 billion equals 79.1% of the nine-month operating income, by our arithmetic. Adding the $4.5 billion of reclassified gains, which the 10-Q says are primarily from Anthropic notes converted to preferred, takes the total to $67.3 billion, or 45.6% of pretax income.

The Tax and the Net Line

Net income rose to $113.6 billion from $56.5 billion, up 101.1%, by our arithmetic. The tax bill rose too. The nine-month provision of $33.9 billion “included $15.2 billion of net discrete tax expense primarily attributable to the upward adjustments to our investments in Anthropic”, the 10-Q says: 44.8% of the provision, by our arithmetic.

The gains on Amazon’s Anthropic convertible notes are booked elsewhere. As we reported on 31 October, they sit in accumulated other comprehensive income, not net income; the 10-Q puts that unrealized gain at $140.3 billion on 30 September.

Why the Third Quarter Looked Different

The markups landed in the first half. The 10-Q’s line for upward adjustments relating to equity investments in private companies, which it says are primarily from the Anthropic preferred stock, shows $7,226 million in the third quarter of 2025 and $39 million in the third quarter of 2026.

So the third quarter of 2026 had operating income of $28.1 billion, up 61.2% from $17.4 billion, while income before income taxes fell 4.6% to $26.9 billion, by our arithmetic. Other income swung from a $10.2 billion gain to a $703 million loss.

What the IPO Changes

The 10-Q says that if Anthropic completes an IPO, Amazon’s preferred stock “would be converted to nonvoting common stock”, and each preferred share “is convertible into ten shares of nonvoting common stock”. Anthropic’s amended S-1 says Amazon will hold 1,920,511,218 Class N shares after the offering, with 1,563,617,444 more issuable on its remaining notes.

At the $74.00 midpoint of the $70.00 to $78.00 range, the preferred is worth $29.1 billion more than Amazon’s own mark, as we reported on 10 November. Alphabet’s filing shows a similar pattern for its largest unlisted stake, which it does not name, as we reported on 31 October.

The Structural Read

As we read the 10-Q, Amazon’s 2026 profit has two engines: AWS and retail operations, which lifted operating income 44.3%, and a holding in a company that is about to list, whose funding rounds were marked into other income.

As we read the third quarter, it shows what a quarter without an Anthropic funding round looks like: operating income up 61.2%, pretax income down 4.6%, by our arithmetic, because the year-earlier quarter carried a $7.2 billion markup.

Three Implications

FOR AMAZON’S EARNINGS In the first nine months of 2026 the Anthropic preferred markups were 42.6% of pretax income and 79.1% of operating income, by our arithmetic.

FOR AMAZON’S TAX BILL The 10-Q ties $15.2 billion of net discrete tax expense primarily to the Anthropic adjustments, 44.8% of the nine-month provision, by our arithmetic.

FOR THE IPO The 10-Q says the preferred converts into nonvoting common stock on an IPO, ten shares for each; the S-1/A puts Amazon at 1,920,511,218 Class N shares after the offering.

The Business Engineer Lens

This story maps onto the Business Engineer framework The AI Capex Map.

The framework reads: “It is a sovereign-scale financing problem dressed in tech-company clothing — and the financial architecture is starting to invert”

As we read it, Amazon’s 2026 income statement shows that inversion from the investor side: the supplier of compute to Anthropic booked $62.8 billion of markups on Anthropic stock, 42.6% of its pretax income, by our arithmetic. The framework predates the 10-Q and does not discuss it.

What Is Not Established

The 10-Q gives the Anthropic markups before tax; it does not split the $15.2 billion discrete tax charge exactly, so we do not compute an after-tax Anthropic figure. The 33.5% growth figure removes only the preferred markups. The $70.00 to $78.00 range is an estimate, not a trading price, and this piece does not estimate how Amazon will book the stake after the listing.

The Bottom Line

About $62.8 billion of Anthropic preferred markups made up 42.6% of Amazon’s $147.6 billion of pretax income in the first nine months of 2026, by our arithmetic from its 10-Q. Without them, pretax income grew 33.5% rather than 108.7%. In the third quarter, with almost no markup, pretax income fell 4.6% as operating income rose 61.2%.