Amazon has reached an agreement with certain lenders for an $8 billion unsecured loan, according to a filing with the SEC. The loan is set to mature in 364 days, with an option to extend for another 364 days, and will be used for “general corporate purposes.”
“Given the uncertain macroeconomic environment, over the last few months we have used different financing options to support capital expenditures, debt repayments, acquisitions, and working capital needs,” said an Amazon spokesperson in a statement sent to Reuters.
The loan will help Amazon weather what could be a difficult year. The ecommerce giant has already paused corporate hiring due to difficult macroeconomic conditions, and is in the process of downsizing unprofitable businesses and closing certain stores as part of a reported cost-cutting effort. Amazon hasn’t officially reported on the number of job cuts, but people familiar with the matter told Reuters the company was aiming to reduce its headcount by approximately 10,000. Amazon has an estimated 1.5 million employees across all of its businesses, including corporate, warehouse and logistics.
Amazon is still growing, but higher costs have slowed it down in 2022 — sales were up 15% in Q3 2022, but net income decreased to $2.9 billion, compared with $3.2 billion in Q3 2021. As a result, Amazon’s share price has fallen 50% year-over-year to approximately $84.