Amazon reported a strong quarterly performance that exceeded Wall Street expectations on both revenue and profitability, driven by accelerating growth in its cloud computing business and continued strength across its North American operations. The results sent Amazon shares up about 6% in after-hours trading, although investors remained cautious after the company issued third-quarter revenue guidance below analysts’ expectations.
The company reported earnings per share of $5.75, far ahead of the $1.82 consensus estimate. Revenue climbed to $200.6 billion, surpassing analyst expectations of $196.5 billion and marking another record quarter for the e-commerce and cloud giant.
Amazon’s profitability also exceeded forecasts by a wide margin. Operating income reached $27.46 billion, compared with expectations of $23.61 billion, while the operating margin expanded to 13.7%, well above the projected 12.0%. The stronger margins suggest Amazon continues to benefit from cost discipline while increasing investments in artificial intelligence and cloud infrastructure.
Amazon Web Services (AWS), the company’s key profit driver, delivered another standout quarter. AWS revenue rose to $42.23 billion, beating estimates of $40.57 billion. Excluding foreign exchange effects, AWS sales grew 37% year over year, significantly faster than the 31.3% growth expected by analysts, highlighting continued robust demand for cloud services and AI infrastructure.
The company’s North American retail business also outperformed expectations, generating $116.18 billion in net sales versus the $113.94 billion consensus forecast. Revenue from physical stores totaled $5.79 billion, slightly below analyst expectations of $5.87 billion, though the shortfall was more than offset by strength in Amazon’s higher-margin businesses.
Amazon also disclosed that its AI business and custom chip business have each individually surpassed an annual revenue run rate of more than $25 billion, underscoring the company’s rapidly expanding presence in the artificial intelligence market. The announcement reinforces Amazon’s position as one of the largest beneficiaries of the global surge in AI spending alongside Microsoft, Google, and NVIDIA.
Despite the strong quarterly results, Amazon forecast third-quarter net sales of $197 billion to $202 billion, below Wall Street’s consensus estimate of $203.9 billion. While the outlook suggests continued growth, the softer guidance indicates management remains cautious about consumer spending and the pace of revenue expansion during the second half of the year.
Overall, the report reinforced Amazon’s leadership across cloud computing, e-commerce, and artificial intelligence. Investors will now focus on whether accelerating AI demand can continue driving AWS growth while supporting the company’s expanding profitability.
