When an Amazon cancellation syncs to Shopify, the line items on that order are released. By default, that stock isn't returned to your Shopify inventory. Turn this on so Shopify automatically re-stocks the cancelled units back to your inventory — keeping your stock counts accurate.

Steps

1. Go to Settings → Order Settings → Cancelation and Refund.
2. Make sure Sync cancelled orders on Shopify is on (this setting is dependent on it).
3. Find Re-stock Inventory on Cancellation and toggle it on.
4. Save.