Amazon just delivered a quarter that made Wall Street sit up and take notice. The e-commerce and cloud computing giant reported second-quarter results Thursday after the bell that smashed expectations on both the top and bottom lines.
Revenue came in at $200.61 billion, beating the consensus estimate of $196.46 billion. Earnings per share hit $5.75, absolutely crushing the analyst forecast of $1.82. Total revenue grew 20% year-over-year, with every major segment contributing.
Here's how the segments broke down:
- North America: $116.2 billion, up 16%
- International: $42.2 billion, up 15%
- Amazon Web Services: $42.2 billion, up 37% — the fastest growth in 18 quarters
The AWS number is the headline grabber. Cloud computing has been a battleground, and Amazon's dominant position is getting stronger. CEO Andy Jassy highlighted that "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."
Amazon's massive investments in artificial intelligence are showing up in the numbers. Operating cash flow jumped 33% to $161.4 billion over the trailing 12 months, but free cash flow swung to an outflow of $7.6 billion. That's because the company spent $66.1 billion more on property and equipment year-over-year, much of it for AI infrastructure. Amazon ended the quarter with $80.93 billion in cash and equivalents.
On the retail side, Jassy noted record delivery speeds: "over 40% more items delivered same-day or overnight, with Grocery and Everyday Essentials growing meaningfully faster than the rest of the business."
Looking ahead, Amazon's guidance was a bit mixed. Third-quarter revenue is expected between $197 billion and $202 billion, below the $204.08 billion analysts were looking for. But operating income is projected to be $22.5 billion to $26.5 billion, up from $17.4 billion in the same period last year. That suggests margins are improving even as the company invests heavily.
"There's a lot to be excited about, and we have much more coming for customers in the second half of the year and beyond," Jassy added.
Investors liked what they heard. Amazon shares, which were up just 3.75% year-to-date heading into the report, surged 9.12% in after-hours trading to $256.97.
Amazon management will discuss the results further on an earnings call at 5 p.m. ET.
