Amazon Q2 2026 Earnings: AWS Growth Accelerates as AI Investment Gain Lifts Profit
AWS cloud growth hit its fastest pace in years and Amazon raised AI spending plans to $220B, while a one-time Anthropic investment gain inflated headline profit.
| Q2 2026 | Reported | Expected | Surprise |
|---|---|---|---|
| EPS | $1.88 | $1.94 | -3.1% |
| Revenue | $200.61B | $207.91B | -3.5% |
Key takeaways
- Amazon Web Services, the cloud-computing division, grew about 37% from a year earlier — its fastest pace in roughly four and a half years — as demand for AI computing power accelerated. AWS’s AI-related business alone now runs at more than a $25 billion annual pace, and the division’s profit grew even faster than its sales, with operating margin near 39%.
- The reported per-share profit figure was unusually large mainly because of a one-time, non-cash gain of roughly $53 billion tied to the rising paper value of Amazon’s investment in AI startup Anthropic — money the company hasn’t actually collected. Stripping that gain out, underlying per-share profit was much closer to, and just shy of, what analysts had modeled for the quarter.
- Total sales grew about 20% from a year ago, extending a recent run of accelerating growth, with cloud computing and advertising (up roughly 26%) the biggest contributors alongside the core online retail business.
- Profitability metrics over the past year show margins improving as AWS and advertising — both higher-margin businesses than traditional retail — make up a growing share of Amazon’s overall profit mix, and the company is generating a healthy return on shareholders’ equity.
- Amazon raised its planned 2026 capital spending to about $220 billion, up from roughly $200 billion previously, mostly to build out AI data centers and custom computer chips. That spending pace outran the cash coming in from day-to-day operations, pushing free cash flow over the past year into negative territory — a sign management is prioritizing long-term AI infrastructure over near-term cash generation.
- For the current quarter, Amazon guided to revenue of $197 billion to $202 billion and operating income of $22.5 billion to $26.5 billion. Management noted an unfavorable currency swing and said shifting this year’s Prime Day discount event from July into June will make next quarter’s growth comparison look weaker than the underlying business trend.
- Investors reacted positively, sending Amazon shares sharply higher after the report, as the strength and acceleration in AWS growth and AI demand outweighed the more complicated picture on headline profit and revenue relative to Wall Street targets.
Fundamentals
| Metric | Value | Period |
|---|---|---|
| Gross margin | 50.8% | Trailing 12 months |
| Operating margin | 12.1% | Trailing 12 months |
| Net profit margin | 17.4% | Trailing 12 months |
| Pretax margin | 22.6% | Trailing 12 months |
| EPS | $12.43 | Trailing 12 months |
| Revenue growth (YoY) | 15.8% | Trailing 12 months |
| EPS growth (YoY) | 89.7% | Trailing 12 months |
| Return on equity | 30.5% | Trailing 12 months |
Amazon.com, Inc. financial history: revenue, margins, and cash flow →
Sources: company report · CNBC · Yahoo Finance · Investing.com