An Update on ‘Other Income’ This Quarter

Amazon.com ($AMZN) reported its latest quarterly earnings last Friday, and of course the company reported gobs of revenue ($180.2 billion) and pretax income ($28.2 billion) because that’s what you do when you’re an e-commerce giant astride the globe.

Then, as always, Calcbench squinted more closely at that $28.2 billion in pretax income. Only $17.4 billion of that number came from Amazon’s operating income; another $10.2 billion came from the ever-mysterious line item known as “Other” income. What was that about? 

So we dove into Amazon’s footnote disclosures, because you can do that in Calcbench thanks to our Tracing feature and our Disclosures & Footnotes Query page. Soon enough, we found this explanation on Page 30 of the 10-Q, tucked away in the Management Discussion & Analysis:

The net gain of $10.2 billion in Q3 2025 and $14.1 billion for the nine months ended September 30, 2025 is primarily from an upward adjustment for observable changes in price relating to our nonvoting preferred stock in Anthropic, and the reclassification adjustments for the gains on available-for-sale debt securities from the portions of our convertible notes investments in Anthropic that were converted to nonvoting preferred stock during Q3 2025 and for the nine months ended September 30, 2025.

In other words, more than one-third of Amazon’s pretax income for the quarter ($10.2 billion of the $28.2 billion total) comes from its holdings in AI darling Anthropic — a nonpublic company that reportedly doesn’t yet turn a profit.

Don’t get us wrong. Amazon still had $17.4 billion in operating income, and that’s not nothing. Moreover, even if Anthropic isn’t turning a profit, the company is growing like weeds along the Amazon River. Whatever Amazon’s equity or debt holdings in the AI might be, clearly those holdings are worth more today than they were three, six, or nine months ago. Regardless, that’s still a material amount of Amazon’s pretax income tied to financial engineering rather than people buying and selling stuff. 

So we got to wondering: Are any other companies enjoying similar bumps to the bottom line from “other” income?

Spoiler: the answer is yes.

Exploring Other Income

Researching this question was easy. We simply went to our Multi-Company search page and then looked up operating income and “Other non-operating income” for the S&P 500 to see what we’d find.

For Q3 2025 filings so far, we found 178 firms that filed both numbers. Then we expressed Other Income as a percentage of Operating Income, and sorted the answers from highest to lowest. Figure 1, below, shows the 10 firms with the largest Other Income amounts relative to Operating Income.

That’s the list; then you can use the Disclosures & Footnotes Query page to investigate specific companies and why they had such bumper crops of other income.

For example, AT&T ($T) reported $6.25 billion in other income for the quarter, more than all of the telecom giant’s operating income. Most of that $6.25 billion came from the sale of AT&T’s stake in DirecTV to a private equity group:

On July 2, 2025, we sold our interest in DIRECTV to TPG Capital (TPG) and recorded a current note receivable of approximately $3,600, which we expect to receive the majority of by the end of 2025, and a long-term receivable of $500. The disposition of DIRECTV also resulted in the release of approximately $2,900 of historical deferred tax liabilities. We recorded a gain on the sale of DIRECTV of approximately $5,500, which includes the impact of the transfer of deferred tax liabilities, indemnification liabilities and unfavorable contracts…

AT&T reported net income of $9.67 billion for the quarter. If not for that $5.5 billion booked thanks to the DirecTV sale, net income would’ve been less than half of that.

Another adventure in footnote disclosures is Honeywell International ($HON). The company reported $822 million in Other Income, compared to $1.75 billion in operating income. First we traced that $822 million to an Other Income footnote that Honeywell included in its Q3 filing, which included a table (see below) that said most of that Other Income number came from a settlement related to Resideo, a maker of home temperature and security controls that Honeywell spun out in 2018. 

The Other Income footnote directs people to look at the Commitments and Contingencies footnote for more detail about the Resideo issue. We went to that footnote. Long story short, the $802 million is a one-time payout from Resideo to Honeywell to end a long-term indemnification arrangement where Resideo had been paying Honeywell for the costs of environmental matters at old manufacturing sites. 

For the record: yes, Honeywell did report this one-time Other Income gain as an adjustment to net income. The company only reported the number as part of adjusted EPS, rather than adjusted earnings; but the adjustment is in there. 

We could keep going, and perhaps in future posts we will. Our point is simply that the impressive net income and pretax income numbers we’re seeing these days can often be driven by Other Income numbers. There’s nothing inherently wrong with that, but shrewd analysts will keep that question in mind as you assess the long-term earnings quality of the companies you follow. 

All the data is there; Calcbench just helps you find it.