What will Amazon do with $3 billion in nearly free money?

November 28, 2012: 10:13 AM ET

The tech giant has quietly raised capital -- at almost no cost.

FORTUNE -- While online shoppers were gobbling up e-deals on Cyber Monday, Amazon once again demonstrated its appetite for capital. It raised $3 billion in debt at ultra-low interest rates. Spread across three tranches of bonds that mature over 6 ½ years, Amazon will pay an average of 1.6%, which makes the loan nearly cost-free to Amazon, factoring in inflation. The unexpected debt-capital raise, Amazon's first in 15 years, double's Amazon's cash stockpile. (The Wall Street Journal has a lot of the facts here.)

The swift move got me wondering what Amazon (AMZN) will do with the money. There are obvious starting points. Amazon recently cut a deal to buy its currently leased Seattle headquarters buildings for a bit more than $1 billion. It's an odd decision, but Amazon is an odd company. It is investing heavily in new warehouses, the better to offer speedier delivery to customers, particularly in locations where Amazon recently has begun collecting state sales taxes—something it probably should have been doing all along. In my recent interview with Amazon CEO Jeff Bezos he deflected the question of whether Amazon wants to offer same-day delivery, saying the company hasn't figured out how to make such a service economical. He said it's hard enough investing simply to push back in the day when Amazon cuts off taking new orders.

MORE: Amazon's Jeff Bezos: The ultimate disrupter

Given its size and growth, it's also astounding that Amazon sells in just nine countries: the U.S., Canada, China, France, Germany, Italy, Japan, Spain, and the United Kingdom. Counterintuitively, Bezos notes that Amazon is investing particularly aggressively at the moment in Spain and Italy. New regions are a natural place for Amazon to invest its cash.

Amazon obviously continues to invest heavily in its Kindle line, which is showing itself to be a worthy competitor to Apple (AAPL) and tablets that use Google's (GOOG) Android operating system. (The Kindle Fire uses a version of Android too.) Amazon's Lab126—it's Kindle design center in Cupertino, Calif.—recently listed more than 200 open job positions.

Then there are Amazon's many business lines, many of which compete against each other. To get a sense of the breadth of Amazon's disparate businesses. I made a list of the 25 brands Amazon links to at the bottom of its U.S. home page, including, with one exception, the way Amazon describes them:

AbeBooks. Rare books and textbooks.

Amazon Local. Great local deals in your city.

Amazon Supply. Business, industrial and scientific supplies. (beta)

Amazon Web Services. Scalable cloud services.

Amazon Wireless. Cellphones & wireless plans.

Askville. Community answers.

Audible. Download audio books.

BeautyBar.com. Prestige beauty delivered.

Book Depository. Books with free delivery worldwide.

CreateSpace. Indie publishing made easy.

Diapers.com. Everything but the baby.

DPReview. Digital photography.

Fabric. Sewing, quilting and knitting.

IMDb. Movies, TV & celebrities.

Junglee.com. Shop online in India.

Myhabit. Private fashion designer sales.

Shopbop. Designer fashion brands.

Soap.com. Health, beauty and home essentials.

Wag.com. Everything for your pet.

Warehouse Deals. Open-box discounts.

Woot. Beta deal site. [My description. Amazon's is so confusing it defies description.]

Yoyo.com. A happy place to shop for toys.

Zappos. Shoes & Clothing.

Vine.com. Everything to live life green.

Casa.com. Kitchen, storage & everything home.

Amazon acquired many of these brands, like Audible, Zappos and IMDb. Some of the sites are clear copycats of more successful startup companies that Amazon hasn't yet bought. Amazon includes a link at the bottom of its home page to its "Internet-based ads" business, a very real attack on the online advertising industry. It makes no mention of the robotics company it acquired this year, Kiva Systems, which continues to maintain its own web site and gives the appearance of serving non-Amazon customers.

So, how can Amazon spend $3 billion? Let us count the ways.

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About This Author
Adam Lashinsky
Adam Lashinsky
Senior Editor at Large, Fortune

Adam Lashinsky is a San Francisco-based editor-at-large for FORTUNE, covering Wall Street and Silicon Valley. Lashinsky joined FORTUNE in 2001, after two years as a contributing columnist. Prior to joining FORTUNE, Lashinsky covered Silicon Valley for TheStreet.com and The San Jose Mercury News. A Chicago native, Lashinsky holds a B.A. in history and political science from the University of Illinois at Urbana-Champaign.

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