Amazon’s board increased the amount of stock and debt the company may buy back over the next two years from $500 million of both to $1 billion of stock and 100% of the debt (about $1.3 billion).
Amazon only has about $1.3 billion of cash available, so it won’t be able to execute the whole buyback until more cash flows in–and it’s not required to buy back anything. Bottom line: announcement largely meaningless. It just gives the company more flexibility to take advantage of favourable market conditions (i.e., conditions in which the stock and debt prices are getting hammered).
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