As the slowing economy brings more challenges, Amazon secures $8 billion loan – SiliconANGLE

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In a filing with the US Securities and Exchange Commission today, Amazon.com Inc. said it reached an agreement with multiple lenders on an $8 billion unsecured loan.

The e-commerce giant initially gave no details on where the money would go, saying only that it would benefit “general corporate causes.” Amazon later told Reuters, “Due to the uncertain macroeconomic environment, we have used various financing options over the past few months to cover investments, debt repayment, acquisitions and working capital needs.”

The loan is due in 364 days, but can be extended for another 364 days. In this case, the current interest rate increases from 0.75% to 1.05%.

According to the filing, lenders include Australia and New Zealand Banking Group Ltd., New York Branch of Banco Bilbao Vizcaya Argentaria SA, Bank of China Los Angeles Branch, Credit Agricole Corporate and Investment Bank, DBS Bank Ltd., Mizuho Bank Ltd. National Westminster Bank Plc and TD Securities (USA) LLC.

Like most big tech companies, Amazon has had a rough year. Towards the end of 2022, the company reported declines in its cloud computing business, Amazon Web Services Inc., and an overall balance sheet that was not as strong as expected. In terms of AWS, this was the slowest revenue growth since 2014.

The company’s online business did not fare much better. Amazon had expanded into this space during the lockdown, but as people returned to high streets, the company experienced a twist of fate. Compared to competitors such as Meta Platforms Inc., Amazon’s advertising revenue was at least positive. However, the economic downturn meant that Amazon, like most other technology companies, had to take some drastic measures.

These measures included the introduction of a hiring freeze and the possible redundancy of around 10,000 employees worldwide. The company has also stopped development on some of its products and said goodbye to its telemedicine service, which should be very profitable. A strong dollar also helped push Amazon’s stock price down about 50%.

The company reported in the third quarter that its long-term debt is now about $59 billion.

Photo: Scott Lewis/Flickr

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Source: siliconangle.com

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