Amazon — 2026Q3 earnings
reported 2026-07-30
EPS $5.75 vs $1.83 est — beat
next session +15.3% (close 2026-07-30 → 2026-07-31)
Source
Press release ↗Summary
A blowout quarter with an important asterisk: net sales grew 20% to $200.6 billion and operating income rose 43% to $27.5 billion, with AWS reaccelerating to 37% growth — its fastest in 18 quarters, and a fifth straight quarter of acceleration — at a $169 billion run rate, but the tripling of net income to $62.6 billion was driven by a $53.4 billion non-operating gain, primarily on the Anthropic investments, not by operations. The AI buildout is consuming cash — trailing-twelve-month free cash flow swung to a $7.6 billion outflow on a $66.1 billion increase in property-and-equipment purchases. Andy Jassy raised 2026 cash capex to roughly $220 billion (from ~$200 billion, on higher memory costs) and still warned Amazon will be capacity-constrained relative to demand through 2026 and likely 2027.
Earnings call
Earnings call webcast ↗Review
From the report
Amazon's quarter reported July 30, 2026 (fiscal Q2 2026, ended June 30) was a blowout: net sales grew 20% to $200.6 billion and operating income rose 43% to $27.5 billion, with AWS reaccelerating to 37% growth — its fastest in 18 quarters — at a $169 billion annualized run rate. Headline net income of $62.6 billion was inflated by a $53.4 billion non-operating pre-tax gain, primarily from Amazon's Anthropic investments, while surging AI capex pushed trailing-twelve-month free cash flow to a $7.6 billion outflow. Guidance for the next quarter calls for $197.0-$202.0 billion in net sales and $22.5-$26.5 billion of operating income.
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Net sales rose 20% year-over-year to $200.6 billion, up from $167.7 billion in the year-ago quarter. show quote
“Net sales increased 20% to $200.6 billion in the second quarter, compared with $167.7 billion in second quarter 2025.”
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AWS reaccelerated to 37% growth — its fastest in 18 quarters — reaching a $169 billion annualized revenue run rate. show quote
“AWS net sales increased 37%—its fastest growth in 18 quarters—to a $169 billion annualized revenue run rate”
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Net income more than tripled to $62.6 billion, or $5.75 per diluted share, versus $18.2 billion ($1.68 per diluted share) a year earlier. show quote
“Net income increased to $62.6 billion in the second quarter, or $5.75 per diluted share, compared with $18.2 billion, or $1.68 per diluted share, in second quarter 2025.”
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The bottom line was swollen by a $53.4 billion non-operating pre-tax gain, primarily from Amazon's investments in Anthropic — not by operations. show quote
“Second quarter 2026 net income includes non-operating pre-tax other income of $53.4 billion, primarily from our investments in Anthropic.”
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Trailing-twelve-month free cash flow swung to a $7.6 billion outflow as property-and-equipment purchases rose $66.1 billion year-over-year, an increase the release ties primarily to artificial-intelligence investments. show quote
“Free cash flow decreased to an outflow of $7.6 billion for the trailing twelve months, driven primarily by a year-over-year increase of $66.1 billion in purchases of property and equipment, net of proceeds from sales and incentives. This increase primarily reflects investments in artificial intelligence.”
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From the call
On the July 30 call, CEO Andy Jassy framed AWS's 36.7% growth as a fifth straight quarter of acceleration driven by AI demand, said Amazon now expects roughly $220 billion of 2026 cash capex (up from a prior ~$200 billion estimate, on higher memory costs), and warned that even that spend leaves Amazon capacity-constrained relative to demand in 2026 and likely 2027.
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CEO Andy Jassy stressed that AWS's 36.7% year-over-year growth marked a fifth consecutive quarter of acceleration and its fastest pace in 18 quarters, achieved on a far larger revenue base than back then. show quote
“Revenue growth of 36.7% year-over-year, accelerating for the fifth straight quarter, our fastest growth in 18 quarters back when AWS was less than half its current revenue size.”
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Jassy raised the 2026 cash capex outlook to approximately $220 billion, up from the prior estimate of about $200 billion, attributing the increase to the higher cost of memory. show quote
“We now believe we will spend approximately $220 billion in cash CapEx in 2026. The higher cost of memory pushing this number up from our prior estimate of about $200 billion.”
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Jassy warned that even at that spending level Amazon will not have enough capacity to meet all of its 2026 demand, and he expects the same supply-demand imbalance in 2027. show quote
“Even at that amount, we will still not have enough capacity to meet all the demand we have in 2026, and I believe this dynamic will also be true in 2027, too.”
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as of 2026-08-10