Amazon opens new tab on forecast third-quarter sales above market estimates, but failed to live up to lofty expectations for its Amazon Web Services cloud computing unit after rivals handily beat Wall Street forecasts.

Wall Street

Amazon reported financial results that exceeded analyst expectations for both earnings per share and revenue. The company posted an EPS of $1.68, above the expected $1.33, and revenue of $167.7 billion, surpassing the forecasted $162.09 billion. Amazon Web Services (AWS) delivered a growth rate of 17.5%, just above estimates, with $30.87 billion in revenue. Despite these positive results, Amazon shares fell slightly, with analysts noting that the company's guidance and the performance of AWS, which accounts for over 60% of Amazon's operating income, remain key areas of focus.

Industry observers are also watching Amazon's advertising segment and the impact of artificial intelligence on its business, especially in comparison to competitors like Meta. Additionally, the performance of Amazon's e-commerce operations and the effects of tariffs, particularly due to goods sourced from China, are being closely monitored.

Amazon shares sink despite beat on revenue and earnings

report. Amazon is out. Mackenzie Sagalos has the numbers for us. Hi, Mac. Hey there, Morgan. Amazon shares moving lower, about three quarters of a percent, despite a beat on both the top and bottom line. You've got EPS coming in at $1.68 versus $1.33. Revenue also beat at $167.7 billion versus $162.09 billion. Cloud, AWS, this was a big number that analysts were looking for, and that came in at a growth rate in Q2 of 17.5 percent, just beating that 17.2 percent estimate there. We've also got a number on revenue for AWS at $30.87 billion, just beating the street at $30.8 billion. And really, that is the big number that we look at. We see how AWS is stacking up against rivals Azure and Google Cloud. Azure really posting a blockbuster quarter for Q2. So we're going to keep unpacking these numbers for you, Morgan, and I'll be back to you soon with guidance, because those shares, little change, and usually it's that quarterly guidance that tends to weigh down sentiment when we see a beat on the top and bottom lines. OK. Yeah. Shares are bouncing around right now. Mackenzie, thank you. Let's get reaction to those results. Barbara Duran of BD8 Capital Partners joins us now. Barb, it's great to have you on. Let's start right there, because so far, it would seem with some of these metrics we've heard and we've gone through from this report, it is a beat for Amazon. Your takeaway? Yeah, I think it was important. All eyes are really on the AWS, particularly because Alphabet had reported and Microsoft, and they reported both respectively 32 and 34 percent growth. And of course, this is an area where the last few quarters Amazon has missed. And so it sounds like, you know, from the initial read, that revenues were a little bit better than expected. So it's probably up 17 to 18 percent, which would be good because it would mean that hopefully they're holding share, because right now they are the leaders. They've got 29 percent share there versus Azure, 22 percent. And of course, Google bringing up at 12 percent. And the reason the AWS is so important is because it's 60 plus percent of their operating income. So all eyes are on that. The other thing we really want to see is really what's happening with their advertising, you know, and how the A.I. is working. We certainly saw with Meta how their A.I. ad target is working so well for their increasing their engagement, increasing sell through to advertisers. And so we want to hear about that. And of course, we want to see e-commerce, what they're seeing with consumers and the impact tariffs, given that so much comes from China.

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