AMZN · 10-Q · 2026Q2 · Full report

Supply Chain Constraints

AMAZON COM INC · 2026-07-31 · Importance 32 · Surprise 24

Amazon maintains supplier commitments for certain electronic-device components and products based on forecasted customer demand, creating potential costs if commitments are reduced. Inventory valuation depends on expected disposition through customer sales, vendor returns, or liquidation, and a 1% additional inventory valuation allowance as of June 30, 2026 would have increased cost of sales by approximately $405 million. Shipping costs increased to $27.9 billion in Q2 2026 and $53.6 billion for the first six months, with Amazon seeking to mitigate costs through fulfillment-network optimization, supplier negotiations, higher volumes, and operating efficiencies.

Key facts

• Inventories sensitivity: for every 1% of additional inventory valuation allowance as of June 30, 2026, we would have recorded an additional cost of sales of approximately $405 million. source