A company that started as an online bookstore and grew into one of the world's largest retailers and cloud providers, selling goods through Amazon Prime, while its AWS arm supplies on-demand computing, storage, and AI services to developers and enterprises. Jeff Bezos founded it in 1994 in his Bellevue, Washington garage, naming it after the Amazon River—the world's largest—hoping to build the biggest bookstore on Earth. Early employees worked at desks made from doors.
AWS sales rose 37% to $42.2B, driving Q2 2026 revenue up 20% to $200.6B
growth carried the quarter, rising 37% to $42.2B. rose 19.6% to $200.6B, widened 0.4 points to 52.3%, and rose 43.2% to $27.5B as AWS operating income climbed 64% to $16.6B. The company is funding AI infrastructure through negative and rising debt.
Key takeaways
sales grew 37% to $42.2B, driven by increased customer usage partially offset by pricing changes from long-term contracts, and its rose 64% to $16.6B on higher sales.
Consolidated rose 19.6% to $200.6B and rose 43.2% to $27.5B, with North America up 16% to $116.2B and International up 15% to $42.2B.
widened 0.4 points to 52.3% and rose 242.3% to $5.75, while rose 244.9% to $62.6B.
Section summaries
Management's Discussion and Analysis
Q2 2026 consolidated net sales rose 20% to $200.6B, driven by 37% AWS growth, while operating income surged 43% to $27.5B.
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sales grew 37% to $42.2B in Q2 2026, driven by increased customer usage, partially offset by pricing changes from long-term contracts.
North America sales increased 16% to $116.2B, reflecting higher unit sales, advertising sales, and subscription services.
International sales rose 15% to $42.2B, also driven by increased unit sales, advertising, and subscriptions.
turned negative at -$7.6B, down from $18.2B a year earlier, as nearly doubled to $169.0B for infrastructure.
Technology and infrastructure costs rose 22% to $33.2B from increased and infrastructure spending to support growth.
rose 154.1% to $128.9B versus a year earlier, reflecting elevated infrastructure financing.
What changed
Q3 2025 was flagged to be watched absent further settlements; this quarter operating income rose 43.2% to $27.5B with no stated settlement or severance charges, versus the $2.5B FTC and $1.8B severance that held Q3 2025 flat at $17.4B.
Trailing-twelve-month was flagged after dropping to $1.2B in Q1 2026; it turned negative at -$7.6B in Q2 as stayed elevated at $169.0B, versus $18.2B a year earlier.
Full-year 2025 of $131.8B was flagged as the base for 2026; trailing-twelve-month capex reached $169.0B in Q2, above that base.
was flagged after Q1 2026 sales rose 28% to $37.6B; Q2 AWS sales rose 37% to $42.2B and operating income rose 64% to $16.6B.
International profitability was flagged to sustain at scale; Q2 International sales rose 15% to $42.2B, sustaining full-year profit first achieved in 2024.
Risk factors updated to name intensifying AI and cloud competition, China and India regulatory restructuring risk, and open investigations into stores, Prime, and .
What to watch
Q3 2026 of growth 9-12% and $22.5B-$26.5B versus $17.4B a year earlier.
Trailing-twelve-month next quarter after turning negative at -$7.6B as nears $169.0B.
Full-year 2026 versus the $169.0B trailing-twelve-month base as AI build-out continues.
trajectory after rising 154.1% to $128.9B as infrastructure financing expands.
Consolidated increased 43% to $27.5B, with operating income up 64% to $16.6B, primarily due to higher sales.
Technology and infrastructure costs rose 22% to $33.2B, driven by increased infrastructure spending, including , to support growth.
Trailing twelve-month turned negative at -$7.6B, down from $18.2B a year ago, as nearly doubled to $169.0B.
Q3 2026 projects growth of 9-12% and between $22.5B and $26.5B.
Quantitative and Qualitative Disclosures About Market Risk
Amazon faces interest rate, foreign exchange, and equity investment risks, with FX sensitivity quantified for cash and intercompany balances.
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Fixed-rate is carried at , so interest rate changes do not impact earnings, but its fluctuates inversely with rates.
fell $82 million in Q2 2026 due to foreign exchange rate movements.
A 20% adverse FX move against foreign funds ($20.4B) would cause a $4.1B decline; a similar move on intercompany balances would trigger a $1.6B loss in other income.
The company uses $20.7B of Euro- and CAD-denominated notes as net investment hedges, with unrealized FX gains/losses recorded in accumulated other comprehensive income.
Equity investments total $229.7B, with $7.4B in public companies marked to ; private company valuations (including and OpenAI) are deemed too uncertain for sensitivity analysis.
Intensifying competition, international regulatory complexity, and AI/expansion risks dominate Q2 FY2026 risk disclosures.
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Competition is intensifying from new business models and well-funded entrants, particularly in AI, cloud, and e-commerce, which may force higher spending or lower prices.
International operations face heightened risks from evolving regulations in China and India, including potential forced restructuring, and from trade restrictions impacting China-based sellers and suppliers.
Expansion into new products, services, and technologies like AI and machine learning carries significant investment risk, potential write-downs, and uncertain customer adoption.
The company faces multiple open competition and consumer protection investigations, including into its stores, fulfillment network, Prime, and cloud services, with unpredictable outcomes.
System interruptions, data security incidents, and the complexity of optimizing a global fulfillment and data center network pose ongoing operational threats to sales and costs.
Evolving government regulation, including new taxes on digital services and global minimum taxes, and numerous legal proceedings create substantial legal and financial uncertainty.