Amazon.com Inc (AMZN)

Debt-to-equity ratio

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Long-term debt	US$ in thousands	58,314,000	67,150,000	48,744,000	31,816,000	23,414,000
Total stockholders’ equity	US$ in thousands	201,875,000	146,043,000	138,245,000	93,404,000	62,060,000
Debt-to-equity ratio		0.29	0.46	0.35	0.34	0.38

December 31, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $58,314,000K ÷ $201,875,000K
= 0.29

The debt-to-equity ratio of Amazon.com Inc. has exhibited fluctuations over the past five years. As of December 31, 2023, the ratio stands at 0.29, indicating a lower level of debt relative to equity compared to previous years. This decline suggests that the company has potentially reduced its reliance on debt financing in favor of equity funding.

In 2022, the ratio was 0.46, showing a higher proportion of debt to equity, likely signaling increased borrowing or a decrease in equity. The ratio then decreased to 0.35 in 2021 before falling further to 0.34 in 2020. This downward trend from 2021 to 2020 may imply a shift towards a more balanced capital structure.

Comparing the most recent ratio to that of 2019, where the ratio was 0.38, we observe a declining trend over the five-year period. This overall decrease indicates a potentially improved financial position in terms of leverage and solvency, with a lower reliance on debt to finance company operations.

It is essential to note that a lower debt-to-equity ratio signifies lower financial risk and greater financial stability for Amazon.com Inc., although a very low ratio could indicate underutilization of debt as a cheaper source of capital. The trend in this ratio suggests evolving capital structure decisions by the company over the years.