Amazon.com, Inc. (AMZN.US) jumped after the performance results! Q3 performance exceeded expectations, AWS sales achieved the fastest growth rate in three years.

Thanks to the strong performance of its cloud business, Amazon.com, Inc. (AMZN.US) exceeded market expectations in the third quarter of 2025. The financial report shows that Amazon.com, Inc.'s net sales in Q3 increased by 13% year-on-year to $180.2 billion, surpassing analysts' average expectation of $177.8 billion. By segment, the sales of the AWS (Amazon.com, Inc. Cloud Services) division increased by 20% year-on-year to $33 billion, marking the largest growth since 2022, with year-on-year growth and sales exceeding analysts' average expectations of 18% and $32.4 billion, respectively. At the same time, sales in the North American business increased by 11% year-on-year to $106.3 billion, and international business sales increased by 14% year-on-year to $40.9 billion. By category, revenue from online stores increased by 10% year-on-year to $67.4 billion; revenue from third-party seller services increased by 12% year-on-year to $42.5 billion; advertising services revenue increased by 24% year-on-year to $17.7 billion; revenue from physical stores increased by 7% year-on-year to $5.6 billion; and revenue from subscription services increased by 11% year-on-year to $12.6 billion. In terms of profitability, the operating profit for Q3 was $17.4 billion, unchanged from the same period last year; excluding two special expenses for the quarter - a $2.5 billion expense related to a legal settlement with the Federal Trade Commission (FTC) and an estimated $1.8 billion cost for layoffs, operating profit would reach $21.7 billion. Net profit was $21.2 billion, an increase of 39% compared to the same period last year; diluted earnings per share were $1.95, exceeding analysts' average expectation of $1.57. Amazon.com, Inc.'s strong performance in AWS in the third quarter dispelled investors' concerns that the world's largest cloud computing service provider was being caught up by competitors. In the second quarter, Microsoft Corporation (MSFT.US)'s Azure cloud business grew at almost double the rate of AWS, while Alphabet's (GOOGL.US) Google Cloud grew by 33.5%. Prior to the financial report release, investor expectations for Amazon.com, Inc.'s cloud business were relatively low, as the company had mentioned in previous quarters that new data center deployments were limited. CEO Andy Jassy and other executives have expressed optimism about the cloud business but have not specifically predicted that growth would accelerate again. As a result, following the release of the financial report, as of the time of writing, Amazon.com, Inc.'s stock surged more than 13% in after-hours trading on Thursday. Jassy emphasized the prospects of AWS at the start of the financial earnings call with analysts, citing a series of AI-driven metrics driving company business, many of which Amazon.com, Inc. had not disclosed before. The company estimates that its shopping chatbot Siasun Robot & Automation "Rufus" embedded in retail applications will bring in an additional $10 billion in sales annually. Jassy stated that the call center product "Connect" is widely regarded as one of the company's most successful products in office software, with annualized revenue expected to reach $1 billion. AWS' AI model service platform "Bedrock" is expected to eventually grow into a business comparable in scale to the core computing service EC2 (one of AWS's main profit sources). Jassy said, "We're building momentum. You can already see the results." Under Jassy's leadership, Amazon.com, Inc. has been focused on enhancing the profitability of its retail business through increased automation and selling high-margin ads and services to e-commerce sellers. As investor attention shifts to the competition in the AI field, the focus of these retail business reforms has gradually faded from public view. S&P Global, Inc. analyst Melissa Otto said that the strong performance of Amazon.com, Inc.'s cloud business and core retail business may ease investors' concerns about the company "overinvesting in the AI bubble". She said, "We see strong evidence that the AWS business is performing exceptionally well. This is not a bubble, it's more like a healthy business where all engines are running at full capacity." Like its major competitors, Amazon.com, Inc. is also investing heavily in data centers and chips to build and operate AI models that can generate text, images, and automate processes. CFO Brian Olsavsky stated that the company's capital expenditures in the current quarter increased by 61% year-on-year to a record $34.2 billion. Brian Olsavsky also said that the company expects capital expenditures in 2025 to be around $125 billion, higher than analysts' forecast of $118.8 billion. While Amazon.com, Inc. is trying to position its cloud business as a wide market platform for AI tools, it still largely relies on a single partner - Anthropic PBC, a startup that developed the chat Siasun Robot & Automation Claude and the AI programming assistant. Amazon.com, Inc. has invested a total of $8 billion in Anthropic and built a large data center cluster and a custom AWS AI chip system for it. The system, known as "Project Rainier," is now fully operational. Media reports indicate that the new data center will help Amazon.com, Inc. address concerns that it missed out on a lucrative wave of AI-related trades in cloud services. In addition, Amazon.com, Inc. stated that its latest AI chip Trainium2 has been "fully sold out," with a business scale reaching several billion dollars. Looking ahead, Amazon.com, Inc. expects net sales in the fourth quarter to be between $206 billion and $213 billion, representing a year-on-year increase of 10% to 13%; it expects operating profit to be between $21 billion and $26 billion, compared to $21.2 billion in the same period last year.