Amazon reported second-quarter amzn earnings that crushed Wall Street estimates, posting $200.6 billion in revenue—up 20 percent year-over-year—and earnings per share of $5.75, far exceeding the analyst consensus of $1.81, according to the company’s official earnings release July 30. The strong results sent the stock surging more than 12 percent in after-hours trading, as investors embraced the company’s aggressive push into artificial intelligence infrastructure.
Operating income jumped 43 percent to $27.5 billion, while net income reached $62.6 billion for the quarter. The company’s North America segment posted sales of $116.2 billion, up 16 percent, and International sales grew 15 percent to $42.2 billion, demonstrating broad-based strength across the retail business.
The standout performance came from Amazon Web Services, which delivered revenue of $42.2 billion, growing 37 percent year-over-year—its fastest pace in 18 quarters, according to the official announcement. AWS segment operating income surged to $16.6 billion from $10.2 billion in the same quarter last year. CEO Andy Jassy highlighted the momentum in a statement: “AWS is booming, growing 36.7% year-over-year in Q2—our fastest growth in 18 quarters—and our AI and Chips businesses each eclipsed run rates of more than $25 billion.”
The AI Spending Bet
The surge in cloud growth justified Amazon’s massive capital spending plans. The company raised its 2026 capital expenditure guidance to $220 billion, up $20 billion from the previous forecast of $200 billion, according to the Wall Street Journal and Reuters reporting on the earnings call. The increase reflects both higher memory chip prices and aggressive investment to meet surging demand for AI infrastructure, the company said.
That heavy spending came with a cost: Amazon’s free cash flow swung to a $7.6 billion outflow on a trailing twelve-month basis, down from an inflow of $18.2 billion a year earlier, according to the official earnings release. Operating cash flow still grew 33 percent to $161.4 billion for the trailing twelve months, but the company’s capital intensity—the ratio of spending to revenue—has reached levels not seen before in its history.
AWS’s acceleration marks a sharp rebound from earlier in 2026, when the division had grown 28 percent in the first quarter. The Q2 jump to 37 percent exceeded analyst expectations of 31 percent growth, according to CNBC and other outlets. The company attributed the acceleration to triple-digit growth in its AI and custom chips businesses, both of which now generate more than $25 billion at annualized run rates.
Amazon’s cloud dominance now encompasses not just infrastructure services but a growing portfolio of AI tools. The company expanded Amazon Bedrock, its managed AI service, with access to 10 new foundation models including OpenAI’s GPT-5.6 and Anthropic’s Claude Opus 5. Bedrock now serves hundreds of thousands of customers, with more added in the last six months than in the first two years after launch, according to the earnings announcement.
The company also announced a $1 billion investment in AWS Forward Deployed Engineering, a team of AI engineers embedded directly with customers to deploy agentic AI solutions in days rather than months. Early customers include the NBA, the NFL, and Cox Automotive, signaling Amazon’s ambition to become not just a cloud provider but an AI implementation partner.
For investors, the earnings report settled a debate that had roiled tech stocks for months: whether the massive spending on AI infrastructure would eventually pay off. Amazon’s results suggest the bet is working—at least in the near term. AWS’s acceleration, combined with the company’s willingness to raise capex guidance despite near-term free cash flow headwinds, signals confidence that the AI boom will justify the investment for years to come.
Sources
- Amazon Investor Relations — Official Q2 2026 earnings release with revenue, EPS, operating income, and capex guidance
- Yahoo Finance — Stock price reaction and real-time trading data after earnings announcement
- Wall Street Journal — Capital expenditure guidance increase to $220 billion and AWS growth details
- Reuters — AWS revenue jump to $42.2 billion, capex increase, and free cash flow impact
- CNBC — AWS sales expansion at 37% year-over-year and analyst expectations comparison
