Hajra Naz
Amazon released its third-quarter financial results on Thursday. The company failed to meet Wall Street estimates for total revenue and earnings per share. Several other concerning figures spooked investors, particularly regarding the rate at which Amazon spent capital.
However, the earnings report highlighted one major success story. The company’s cloud division, Amazon Web Services, topped revenue forecasts. AWS expanded by an impressive 39% compared to the same period last year.
Here is the breakdown of the key figures:
Net sales rose 12% to reach $201.9 billion. Wall Street analysts anticipated $202.2 billion, according to FactSet data.
Fully diluted earnings per share came in at $1.89. Wall Street expected earnings of $1.97 per share.
AWS generated $45.98 billion in revenue. Financial analysts forecasted $45.29 billion. Amazon also noted that AWS operating income climbed to $17.8 billion. That figure marks an increase from $11.4 billion recorded during the third quarter of 2025.
The most concerning metric in the report involved Amazon’s cash reserve depletion. Free cash flow dropped to negative $42.4 billion across the trailing 12-month period. This drop shows the firm spent significantly more cash than its operations generated. By comparison, Amazon posted a positive free cash flow of $14.8 billion for the trailing 12 months ending September 30, 2025.
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Heavy capital outlays stemmed primarily from Amazon’s massive AI investments. With one quarter remaining in its fiscal year, Amazon reaffirmed its guidance. The company still expects 2026 capital expenditures to reach approximately $220 billion.
That capital spending figure highlights an immense financial commitment. Amazon projected fourth-quarter net sales between $240 billion and $247 billion. The final quarter represents a retailer’s busiest season, driven by holiday shopping traffic. Consequently, Amazon plans to spend nearly as much on full-year capital projects, mostly centered on AI, as it expects to earn during its largest sales quarter.
