Anthropic stake markups drove $28.7B of Alphabet profit and $16.8B of Amazon’s last quarter

Alphabet and Amazon disclosed in their first-quarter earnings that markups on their stakes in Anthropic accounted for a substantial share of their reported profits, with Alphabet booking about $28.7B from updated equity values, primarily from Anthropic, out of $62.6B in total profit, and Amazon attributing $16.8B in pre-tax gains from its Anthropic investments, more than half of its pre-tax income. Amazon told Fortune the markup was triggered by Anthropic's Series G funding round and the conversion of some convertible notes into preferred stock, with the company's $8B investment now worth more than $70B, and Alphabet's stake was estimated at 14% before its additional $40B commitment last week. Tax and accounting consultant Robert Willens told Fortune that “it's interesting that they're able to control or influence the value of one of their own assets, and one that they're able to mark to market by engaging in business transactions with that entity.”