Amazon Shares Jump 13% After Strong Q3 Results Beat Expectations Driven by Cloud Growth

Amazon.com Inc. announced robust third-quarter financial results, leading to a significant 13% increase in its shares during after-hours trading. The company reported total revenue of $180.1 billion and Earnings Per Share (EPS) of $1.95, both exceeding the consensus estimates from Wall Street analysts. A major contributor to this success was Amazon Web Services (AWS), its cloud computing division, which generated $33 billion in revenue and achieved a growth rate of 20.2%. This marks the fastest growth AWS has experienced since 2022, although it still trails the performance of key competitors like Google and Microsoft.

Additionally, Amazon has elevated its capital expenditure (capex) guidance for the remainder of the year to $125 billion, with further increases anticipated for 2026. The company projects fourth-quarter sales to surpass $200 billion. Chief Executive Officer Andy Jassy also commented on the recent workforce reductions, clarifying that these were not driven by financial necessity or artificial intelligence, but rather by organizational streamlining following years of rapid expansion.

Impact: This strong earnings report, particularly from the high-margin AWS segment, bolsters investor confidence in Amazon's core operations and future growth prospects. The increased capex guidance suggests substantial investment in infrastructure, which is expected to support future innovation and expansion. The positive outlook for the fourth quarter indicates sustained business momentum. Rating: 8/10

Definitions: Revenue: The total income generated by a company from its primary business activities, such as selling goods or services. Earnings Per Share (EPS): A financial metric that shows the portion of a company's profit allocated to each outstanding share of common stock. Cloud Computing: The delivery of computing services—including servers, storage, databases, networking, software, and analytics—over the Internet. Capital Expenditure (Capex): Funds used by a company to acquire, upgrade, and maintain physical assets like buildings, technology, and equipment. Guidance: A forecast or projection provided by a company about its future financial performance.