Amazon Crushes Forecasts; Shares Surge in After-Hours Trading
Amazon published its financial results for the second quarter of 2026, beating analyst expectations for revenue and earnings. Following the report, the company's stock rose by 8% in after-hours trading.
Amazon published its financial results for the second quarter of 2026 last night. The company's revenue was 200 billion dollars, thereby exceeding analysts' forecasts, which stood at 196.4 billion dollars. Earnings per share totaled 5.75 dollars, compared to forecasts of about 1.82 dollars per share. In response to the publication of the reports, Amazon's stock is rising by 8% in after-hours trading.
The cloud services division, AWS, recorded revenue of 42.3 billion dollars, compared to forecasts that stood at about 40.5 billion dollars. Market forecasts expected a growth rate of about 31%, while in practice it was 37%.
Advertising revenue totaled 19.81 billion dollars, compared to analysts' forecasts that stood at 19.43 billion dollars.
Amazon announced that it expects to invest about 200 billion dollars in capital expenditures (CapEx) in 2026, with the bulk of the investments directed toward artificial intelligence infrastructure.
Among the key factors driving growth are OpenAI and Anthropic, which have committed in recent years to large volumes of usage of AWS infrastructure. In addition, Amazon continues to expand its artificial intelligence chip operations, including Graviton, Trainium, and Nitro, which crossed an annual revenue run rate of more than 20 billion dollars in the previous quarter. Investors will be examining whether the company's management provides further updates regarding the growth rate of this sector, which is considered by Jeff Bezos to be the "fourth leg" of Amazon, alongside Marketplace, Prime, and AWS.
Waiting for Andy Jassy
Beyond the results, the main focus is expected to be directed toward the investor call and the update that the company's CEO, Andy Jassy, will provide regarding the continuation of investments in the field of artificial intelligence. Investors will seek to understand whether Amazon intends to leave the 2026 capital expenditure forecast, which stands at about 20 billion dollars, unchanged, or to update it, similar to the trend recently recorded among some of its competitors.
Additionally, the market is expected to follow updates regarding the company's artificial intelligence model strategy. According to reports, Amazon is reducing some of the development activity of the Nova model family and is focusing on the development of a new advanced model, which is expected to be unveiled later this year. At the same time, the company continues to invest in expanding AWS's AI services, including a program of about one billion dollars in which the company's engineers work directly with enterprise clients for the purpose of implementing systems based on artificial intelligence agents.
Ultimately, this time as well, the central question facing investors will be whether Amazon succeeds in proving that the massive investments in artificial intelligence infrastructure are beginning to generate growth and profitability that justify the cost. Strong results in AWS, alongside maintaining a stable investment forecast, may strengthen market confidence in the company's AI strategy. On the other hand, any sign of a slowdown in cloud activity or continued erosion in cash flow could reawaken the fear that investments are growing at a faster rate than the return they are expected to yield.
