Amazon reported third-quarter results that exceeded Wall Street expectations, driven by a sharp rebound in its cloud business and surging demand for AI infrastructure. The e-commerce and cloud giant posted revenue of $180.2 billion, up 13% year-over-year, and net income of $21.2 billion, a 38% increase from the same period last year. Earnings per share came in at $1.95, beating analyst estimates of $1.57.
Shares of Amazon surged more than 13% in after-hours trading, signaling renewed investor confidence after several quarters of slower growth. For the fourth quarter, Amazon projected revenue between $206 billion and $213 billion, with operating income ranging from $21 billion to $26 billion — both above analyst expectations.
“We continue to see strong momentum and growth across Amazon as AI drives meaningful improvements in every corner of our business,” said Andy Jassy, Amazon’s president and CEO. “AWS is growing at a pace we haven’t seen since 2022, re-accelerating to over 20% year-over-year. We continue to see strong demand in AI and core infrastructure, and we’ve been focused on accelerating capacity — adding more than 3.8 gigawatts in the past 12 months.”
Amazon Web Services (AWS), the company’s largest profit engine, reported $33 billion in revenue, up 20.2% from a year earlier and well above Wall Street’s expectation of $32.4 billion. The strong performance marked a clear rebound for the cloud division, which had faced slowing growth amid tightening IT budgets and intensifying competition from Microsoft and Google. AWS contributed $11.4 billion in operating income — accounting for more than half of Amazon’s total operating profit. The company highlighted a growing roster of major enterprise clients during the quarter, including Delta Air Lines, Volkswagen Group, ServiceNow, SAP, Lululemon Athletica, AXA, and the U.S. General Services Administration.
Amazon further revealed that it had added 3.8 gigawatts of new data center capacity globally in the past year — “more than any other cloud provider,” according to Jassy — as part of a $34 billion capital expenditure program dedicated to AI infrastructure. The company expects total capital spending to surpass $125 billion in 2025, up from its previous $118 billion forecast.
AI has become central to Amazon’s growth story across divisions. Beyond AWS, the company has deployed generative AI tools in its advertising, logistics, and retail operations, while investing heavily in Anthropic, the developer behind the Claude chatbot. Earlier this month, Amazon opened Project Rainier, an $11 billion AI data center campus designed to support Anthropic’s large language models and other advanced workloads. In addition to this, Amazon’s online store sales grew 10% year-over-year to $67.4 billion, benefiting from the company’s Prime Day event in July. Subscription services, including Prime memberships, generated $12.6 billion, up 11% from last year.
Advertising revenue — a key profit driver alongside AWS — climbed 24% to $17.7 billion, beating analyst projections. “Advertising continues to grow faster than retail, supported by AI-driven targeting and automation,” said Brian Olsavsky, Amazon’s chief financial officer. Third-party seller services rose 12% to $42.5 billion, while physical store revenue, which includes Whole Foods Market, grew 7% to $5.6 billion. Shipping costs increased 8% to $25.4 billion, reflecting continued investment in logistics efficiency.
Operating income for the quarter was $17.4 billion, roughly flat from a year earlier, after accounting for special charges totaling $4.3 billion. These included a $2.5 billion settlement with the U.S. Federal Trade Commission over Prime membership practices, and $1.8 billion in severance costs tied to the company’s ongoing layoffs. Amazon confirmed this week it will eliminate 14,000 corporate positions, part of a broader efficiency drive that Jassy said was aimed at reducing bureaucracy and improving agility. Reuters reported the total number of job cuts could reach 30,000 as the process continues into 2026. Amazon ended the quarter with 1.58 million employees, up 2% year-over-year.
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