Third-quarter earnings and sales beat forecasts
Amazon shares jumped over 10% in after-hours trading on Thursday after the company reported third-quarter results that exceeded Wall Street expectations. The company posted adjusted earnings of $1.95 per share for the quarter ended in September, marking a 33% increase from the previous year and beating the $1.57 consensus estimate from analysts polled by FactSet.
Revenue rose 13% year-over-year to $180.2 billion, ahead of forecasts calling for $177.91 billion. The upside was driven largely by renewed growth in Amazon Web Services (AWS), the company’s high-margin cloud business.
AWS cloud momentum restores investor confidence
AWS sales climbed 20% to $33 billion, exceeding analyst projections of $32.4 billion and surpassing expectations for 18.1% growth. This marked the fastest pace since 2022 and helped ease concerns that Amazon might be losing cloud market share to Microsoft and Alphabet amid a wave of AI-driven infrastructure demand.
“We continue to see strong momentum and growth across Amazon as AI drives meaningful improvements in every corner of our business,” said CEO Andy Jassy. “AWS is growing at a pace we haven’t seen since 2022. We’ve been focused on accelerating capacity – adding more than 3.8 gigawatts in the past 12 months.”
Holiday quarter guidance lifts sentiment
For the upcoming December quarter, Amazon guided for revenue of $209.5 billion at the midpoint, slightly above analyst expectations of $208.41 billion. It also projected operating income of $23.5 billion, near consensus estimates.
Despite Thursday’s gains, Amazon shares had underperformed for much of 2025, rising just 2.2% year-to-date before the report, compared to a 16% gain in the S&P 500. Prior to earnings, the stock was forming a cup base with a buy point of $238.85, according to IBD MarketSurge. After the earnings release, shares climbed to $246.71 in extended trading.
Amazon currently holds an IBD Composite Rating of 89 out of 99, signaling strong but not top-tier performance based on a blend of growth metrics.
