Amazon borrows $18.5 billion it doesn’t need in new debt sale

Amazon borrows $18.5 billion it doesn’t need in new debt sale

5/11/2021 2:48:00 PM

Amazon borrows $18.5 billion it doesn’t need in new debt sale Inc. sold bonds to refinance debt and buy back stock, as cheap borrowing costs prove too tempting to resist even for a company with tens of billions of dollars in cash.

Amazon is coming off arecordearnings quarter, and it provided a sales forecast for the current period that was stronger than analysts’ estimates. Cash, cash equivalents and marketable securities stood at $73 billion at the end of March, near an all-time high.

How Russian threats turned this country into the go-to expert on cyber defense Daredevil Alex Harvill dies while practicing for a world record motorcycle jump China's about to administer its billionth coronavirus shot. Yes, you read that right

“They can grow into this leverage,” Matt Brill, head of North America investment grade at Invesco Ltd., said on Bloomberg TV on Monday. “If you’re able to borrow for reasonably cheap, and then you’re able to get the operating leverage to go with it, it results in a lot of earnings.”

A representative for Amazon did not respond to requests for comment.Amazon has been a fairly infrequent issuer, but it comes in big on those rare occasions. It last tapped the bond market in June 2020, borrowing $10 billion for general corporate purposes. Before that, it sold $16 billion of bonds in 2017 to help finance its acquisition of Whole Foods Market Inc.

The proceeds of Monday’s offering will be for general corporate purposes, which may also include acquisitions and working capital. The two-year bond will be allocated for eligible green or social projects, which may include clean transportation, renewable energy and sustainable buildings, according to bond documents.

Moody’s Investors Service upgraded Amazon one notch to A1, its fifth-highest investment-grade rating, with a stable outlook. Although the new debt sale temporarily increases leverage, proceeds are expected to be deployed over time for capital expenditures that fuel growth, which is a long-term positive for the credit, Moody’s analyst Charles O’Shea said.

Amazon has been on a spending spree since the pandemic began, building new warehouses and cloud-computing data centers across the world to meet surging demand from online shoppers and businesses turning to remote work. Purchases of property and equipment totaled $45 billion in the 12 months that ended in March, up from $20 billion during the prior period.

AdvertisementThe company’s board of directors authorized $5 billion in share buybacks in 2016, but it has never made purchases under that authority.Citigroup Inc., JPMorgan Chase & Co., Morgan Stanley and Wells Fargo & Co. managed the sale. Read more: Los Angeles Times »

Storm brewing on Katie Ledecky's Tokyo Olympic horizon

OMAHA, Neb. (AP) — Katie Ledecky is used to slaying her competition, winning not by hundredths but by full seconds. Usually lots of 'em. So when the world's dominant female distance swimmer goes slower than expected, it's a shock.

1/8 Solar & Wind are 0 emissions? Each 1 MW of solar farm power requires between 35 to 45 tons of steel, + you need to dig for cadmium, gallium, germanium, etc Make silicon Silicon metal is made from the reaction of silica (SiO2) - They need to be taxing the shit out of these businesses Facebook Amazon Walmart they should be taxed like we are doubled tripled

This is HOW they Pay NOTHING in Federal Taxes! Close down The Loopholes NOW!

Pentagon Weighs Ending JEDI Cloud Project Amid Amazon Court FightDefense officials are considering pulling the plug on the star-crossed JEDI cloud-computing project, which has been mired in litigation from and faces continuing criticism from lawmakers. Good idea. Why would give this to Microsoft hacked platform? I don’t understand why the DOD’s own cyber command can’t further increase in their capabilities and handle this. Why contract out when they could implement and self manage it under their own roof?

Amazon blocked 10 billion listings in counterfeit crackdownAmazon says that it blocked more than 10 billion suspected counterfeits listings last year before any of their offerings could be sold. Now if only they would list Country of Manufacture consistently! I do not want to buy goods made in certain communist countries!

Amazon Just Secretly Took Over $50 Off The Noise-Cancelling AirPods ProThey're sweat-resistant, too.

Halle Berry Calls These Leggings From Amazon an 'Everyday Essential'Halle Berry’s must-have leggings are truly an everyday essential.

Softbank-Backed Health AI Startup Moves Into Clinical Care With Key Amazon HireMaulik Majmudar, the cardiologist who led the tech giant’s push into wearables with Amazon Halo, joins Biofourmis as the company expands beyond software and sensors.

Khloé Kardashian Is Obsessed With This $23 Amazon Water BottleKhloe Kardashian using a $23 water bottle? Already bought one for myself, obvi.