Latest quarter

Amazon reported Q2 FY2026 revenue of $200.6 billion, up 19.6% from $167.7 billion a year earlier. Revenue, as the consensus counts it, was $200.6 billion versus consensus revenue of $197.1 billion, a 1.77% difference. Amazon reported adjusted EPS, as the consensus counts it, of $1.88 against consensus adjusted EPS of $1.83, a 2.73% difference; its reported diluted EPS was $5.75, compared with $1.68 a year earlier.

The filing said North America sales rose 16%, International sales rose 15%, and AWS sales rose 37%, with AWS growth reflecting increased customer usage partly offset by pricing changes from long-term customer contracts. The filing reported gross margin of 52.3%, up from 51.8%, and operating margin of 13.7%, up from 11.4%. Operating cash flow was $45.4 billion, compared with $32.5 billion a year earlier, while free cash flow was −$7.7 billion, compared with $1.1 billion. Amazon reported operating income of $27.5 billion, above its Q2 outlook of $20.0 billion to $24.0 billion, and revenue above its $194.0 billion to $199.0 billion outlook.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

Revenue came in within or above the company’s guide in 7 of the last 7 quarters it guided.

What management said on the call

On the Q2 2026 call, Andy Jassy said AWS growth reflected customer choices around cloud and AI functionality, operational performance and security, as well as customers placing inference workloads near their existing workloads and data. He said AI demand was growing rapidly and was also pulling demand for core computing services.

Jassy said Amazon remained on track to double power capacity by the end of 2027 from 2025 levels. When analysts asked about demand and the capacity build, he said much of the capacity being added for 2027 was reserved and that Amazon had capacity already reserved for 2028. He described current AI adoption as including AI labs and a small number of generative-AI applications at one end, enterprises using AI for productivity and cost avoidance at the other, and a larger potential opportunity in existing enterprise production workloads.

Addressing AWS competition and model choice, Jassy said Amazon did not require its own frontier model to operate a successful AWS business because customers seek access to multiple models. He said Amazon was nevertheless pursuing a frontier model to gain more control over costs, customer price performance, model priorities and speed. Jassy said the company expected at least a half dozen comparably capable models within several years and that its own model would be available through Bedrock.

Jassy said Amazon’s chip business had more than $25 billion in annual revenue and cited demand for its AI and CPU chips. He also said the company was exploring requests from customers to obtain its AI training chips separately from the cloud. On pricing, Jassy said contract prices and terms apply for the duration of those agreements, while new contracts incorporate Amazon’s costs; he identified inflated prices for memory, hard drives and SSDs.

The filing said Q2 cash capital expenditures of $53.1 billion primarily reflected technology infrastructure, largely supporting AWS growth, and fulfillment-network capacity. The filing also said Amazon expects technology and infrastructure spending to increase over time, including for artificial-intelligence and machine-learning initiatives.

Guidance

Amazon’s July results release expects Q3 FY2026 net sales of $197.0 billion to $202.0 billion, representing year-over-year growth of 9% to 12%. The release expects Q3 FY2026 operating income of $22.5 billion to $26.5 billion. Amazon’s preceding Q2 FY2026 outlook had called for net sales of $194.0 billion to $199.0 billion and operating income of $20.0 billion to $24.0 billion.