Amazon Q3 2026 results: AWS grows 39% to $46 billion, fastest in nearly five years, but profit miss and soft outlook sink shares
Amazon's sales rose 12% to $201.9 billion and AWS grew 39%, but earnings of $1.89 a share missed forecasts and shares fell about 6% after hours.
At a glance
- Amazon's net sales rose 12% to $201.9 billion in July–September 2026, and operating income reached a record $28.1 billion, a 13.9% margin.
- Amazon Web Services sales jumped 39% to $46.0 billion, its fastest growth in almost five years, with AWS operating profit of $17.8 billion.
- Earnings per share of $1.89 missed the roughly $1.96–$1.97 analysts expected, hit by higher interest costs and investment losses.
- Amazon forecast fourth-quarter sales of $240–$247 billion and operating income of $28.5–$33.5 billion, midpoints below analysts' estimates.
- Shares, already down 4.3% in regular trading, fell about another 6% after hours to near $229.
Amazon's cloud business grew 39% in the third quarter of 2026, its fastest pace in almost five years, the company said on Thursday, October 29. It wasn't enough for investors. Earnings per share missed forecasts and the holiday-quarter outlook came in light, and Amazon shares fell about 6% in after-hours trading, on top of a 4.3% drop during the regular session.
Total net sales rose 12% to $201.9 billion for July to September. Operating income climbed to $28.1 billion, a margin of 13.9%, the highest Amazon has ever reported.
AWS is growing as fast as it did in 2021
Amazon Web Services, which rents computing power and AI chips to businesses, brought in $46.0 billion of sales, up from about $33 billion a year earlier. Its operating profit rose to $17.8 billion from $11.4 billion. AWS is now almost three times as big as it was in 2021, the last time it grew this quickly.
Chief executive Andy Jassy told analysts that demand for AI capacity is still outrunning supply. He said he expects AWS growth to stay above 40% in both 2027 and 2028 as new data centres and Amazon's own Trainium chips come online. Microsoft's Azure and Google Cloud, which reported a day earlier, also sped up, so the race for AI customers is getting tighter rather than easing.
The numbers against last year
| Q3 | 2026 | 2025 | Change |
|---|---|---|---|
| Net sales | $201.9bn | about $180.2bn | +12% |
| AWS sales | $46.0bn | about $33.0bn | +39% |
| AWS operating income | $17.8bn | $11.4bn | +56% |
| Total operating income | $28.1bn | $17.4bn | +61% |
| Operating margin | 13.9% | 9.7% | record |
| Earnings per share | $1.89 | $1.95 | lower |
| Analysts' EPS forecast | about $1.96–$1.97 | — | miss |
Last year's operating income was held down by a $2.5 billion settlement with the US Federal Trade Commission and about $1.8 billion of severance costs, which flatters the comparison.
Why profit per share fell anyway
Operating profit beat forecasts. What dragged earnings per share below last year were costs further down the income statement. Interest payments are rising as Amazon borrows to pay for data centres, and other investment losses ate into profit. The year-earlier quarter also included large paper gains on Amazon's stake in AI company Anthropic, which did not repeat.
Spending is not slowing. Amazon kept its forecast of roughly $220 billion in cash capital expenditure for 2026, most of it on AI infrastructure. After Alphabet's shares fell about 12% on Thursday over the cost of its own AI build-out, investors are watching that number closely.
Shops slow down as Prime Day moves
Online store sales grew more slowly than in recent quarters, mostly because Prime Day moved into the April–June quarter in most big markets this year, instead of July. Advertising, Amazon's third big business, continued to grow strongly but did not offset the softer retail picture.
The holiday-quarter forecast
For October to December, which includes Black Friday and Christmas, Amazon forecast:
- Net sales of $240 billion to $247 billion, growth of 12% to 16%, including a small hit of about 0.6 percentage points from currency moves.
- Operating income of $28.5 billion to $33.5 billion.
The midpoints of both ranges were below what analysts had pencilled in, and that was the main reason the shares kept sliding after the close. They ended the regular session at $243.79 and traded near $229 after hours.
What it means for shoppers and businesses
For shoppers, nothing changes immediately: Amazon did not announce price changes or new fees with the results. For the many companies in Pakistan, India and the Gulf that run websites and apps on AWS, the bigger story is capacity. Amazon is still adding data centres as fast as it can, including its regions in Mumbai, Hyderabad, Bahrain and the UAE, and says demand for AI computing is ahead of what it can supply.
Amazon's next quarterly results, covering the holiday season, are due in early February 2027. Before that, the company's Black Friday sales on November 27 will be the first test of its fourth-quarter forecast.
Questions people are asking
How much did AWS grow in Q3 2026?
AWS revenue grew 39% from a year earlier to $46.0 billion in the third quarter of 2026, its fastest growth rate in almost five years.
Why did Amazon stock fall after earnings?
Earnings per share of $1.89 came in below forecasts of about $1.96, and Amazon's guidance for the holiday quarter was below what analysts expected, which outweighed the strong cloud numbers.
