Amazon Reports Strong Cloud Growth but Misses Expectations on Earnings and Cash Flow

Amazon reported its third-quarter earnings, revealing that while cloud revenue exceeded forecasts, the company missed Wall Street expectations for total revenue and earnings per share. According to the reported figures, AWS performed strongly, but concerns arose over significant cash burn driven largely by investments in artificial intelligence.

Financial Performance Overview

• Total Net Sales: Reached $201.9 billion, marking a 12% increase, which fell slightly short of analyst expectations of $202.2 billion according to FactSet.
• Earnings Per Share: Fully diluted EPS came in at $1.89, compared to the expected $1.97.
• Cloud Unit Success: Amazon Web Services (AWS) sales hit $45.98 billion, beating analyst expectations of $45.29 billion. AWS operating income also grew to $17.8 billion from $11.4 billion in the third quarter of 2025.

Cash Flow and AI Investments

A major point of concern in the financial report was the company's cash flow. Free cash flow dropped to a negative $42.4 billion for the trailing 12 months, contrasting sharply with a positive $14.8 billion for the same period ending September 30, 2025. Amazon attributed this heavy spending primarily to investments in AI infrastructure.

• Capital Expenditures: Amazon reiterated its expectation to end the 2026 fiscal year with cash capital expenditures of approximately $220 billion.
• Fourth-Quarter Forecast: The company projected net sales between $240 billion and $247 billion for the upcoming quarter.

Practical Implications and Verification

Readers and investors looking to verify these financial figures should consult Amazon's official investor relations website for the primary earnings release and SEC filings. Such reports provide verified financial breakdowns directly from the corporation without third-party interpretation.