Amazon (AMZN) reported first quarter revenue and earnings per share that topped Wall Street estimates, with AWS posting its fastest growth in 15 quarters as the e-commerce giant continues its massive artificial intelligence build-out.<\/p>\n
Amazon stock opened at a fresh intraday record high Thursday before reversing sharply, and falling to test its lowest levels of the week. Even with the reversal, the stock remains on track for its best month since July 2022, up nearly 25%.<\/p>\n
The company reported earnings per share of $2.78, up from $1.59 a year ago. Revenue was $181.5 billion, up from $155.7 billion in the same quarter last year.<\/p>\n
Analysts had expected earnings per share of $1.62 on revenue of $177.2 billion, according to Bloomberg consensus estimates.<\/p>\n
Amazon\u2019s all-important AWS cloud business generated $37.6 billion in revenue, ahead of estimates for $36.7 billion. AWS revenue excluding foreign exchange grew 28%, above expectations for 25.7% growth.<\/p>\n
Analysts were broadly positive on the report, though some flagged that AWS growth may not have cleared higher investor expectations. Bloomberg Intelligence said AWS\u2019s stronger-than-expected growth \u201cconfirms our view that the cloud provider is well placed to capture rising enterprise AI adoption.\u201d<\/p>\n
Citi analysts said Amazon delivered better-than-expected first quarter results and second quarter guidance across revenue and operating income, but noted AWS growth was \u201crelatively in line\u201d and \u201clikely below buyside expectations.\u201d<\/p>\n
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<\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/div>\nJefferies analysts called the report a \u201csolid Q1 rev beat w\/ AWS re-accelerating to 28%,\u201d though they noted that may have fallen short of the roughly 28% to 30% growth investors were looking for. Evercore ISI analysts said the quarter delivered Amazon\u2019s \u201cstrongest top-line and consolidated margin print in several quarters.\u201d<\/p>\n
That balance is central to the Amazon story this quarter. Investors have been looking for evidence that the company\u2019s AI infrastructure buildout is translating into faster cloud growth after Amazon\u2019s roughly $200 billion capital spending plan pressured the stock following its prior earnings report.<\/p>\n
The company\u2019s AI demand story also got more support from new customer commitments. Amazon said OpenAI committed to consume about 2 gigawatts of Trainium capacity through AWS beginning in 2027, while Anthropic secured up to 5 gigawatts of current and future generations of Amazon\u2019s Trainium chips. The company also said it signed a deal with Meta (META) to deploy tens of millions of AWS Graviton cores.<\/p>\n
Amazon also gave investors a clearer view of the demand behind that spending. CEO Andy Jassy said AWS\u2019s cloud backlog \u2014 future business Amazon has already contracted but has not yet turned into revenue \u2014 jumped to $364 billion in the first quarter. That figure excludes Amazon\u2019s recently announced Anthropic deal for more than $100 billion, making the backlog one of the clearest bull cases for Amazon\u2019s AI spending boom.<\/p>\n<\/p><\/div>\n
But the spending ramp is still weighing on free cash flow, which has become the weak spot in Amazon\u2019s otherwise strong earnings report. Amazon said free cash flow fell to $1.2 billion for the trailing 12 months, down from $25.9 billion for the trailing 12 months ended March 31, 2025. The company said the decline was driven primarily by a $59.3 billion year-over-year increase in property and equipment purchases, reflecting investments in artificial intelligence.<\/p>\n The company issued second quarter revenue guidance of $194 billion to $199 billion, above Wall Street expectations, implying growth of 16% to 19% from the same period last year.<\/p>\n But Amazon\u2019s second quarter operating income outlook came in slightly light. The company expects operating income of $20 billion to $24 billion, compared with $19.2 billion in the second quarter of 2025. The midpoint of that range, $22 billion, is below analysts\u2019 expectations for $22.9 billion.<\/p>\n The company\u2019s advertising business generated $17.2 billion in revenue, ahead of expectations, while online store sales and third-party seller services also topped Wall Street estimates.<\/p>\n The stock\u2019s reversal shows investors are still sorting through both sides of the AI trade: AWS growth and backlog are accelerating, but Amazon is still spending heavily before that demand fully turns into revenue and free cash flow.<\/p>\n Jared Blikre is the global markets and data editor for Yahoo Finance. Follow him on X at @SPYJared or email him at <\/em>jaredblikre@yahooinc.com<\/em>.<\/em><\/p>\n Email Daniel Howley at dhowley@yahoofinance.com. Follow him on X\/Twitter at <\/em>@DanielHowley<\/em><\/a>.<\/em><\/p>\n Click here for the latest technology news that will impact the stock market<\/strong><\/p>\n Read the latest financial and business news from Yahoo Finance<\/strong><\/p>\n<\/p><\/div>\n<\/div>\n<\/div>