Amazon’s cloud growth accelerates while heavy investment drains free cash flow

Amazon ($AMZN)’s third-quarter 2026 revenue increased 12% to $201.9 billion, with AWS sales rising 39% to $46.0 billion. Operating income climbed to $28.1 billion from $17.4 billion. Net income nevertheless slipped to $20.7 billion, or $1.89 per diluted share, as the comparison included large Anthropic investment gains a year earlier. The shift of Prime Day into the second quarter also restrained reported sales growth.

For fourth-quarter 2026, Amazon forecasts revenue of $240–247 billion and operating income of $28.5–33.5 billion. It maintained its approximately $220 billion cash capital expenditure plan for 2026, while CEO Andy Jassy said spending would rise substantially in 2027. Infrastructure spending has significant cash consequences: trailing twelve-month free cash flow was negative $42.4 billion, despite operating cash flow rising 29%. Stronger cloud demand therefore comes with a growing investment requirement.

Sources:

• ir.aboutamazon.com
• Issuer release or filing via StockTitan
• benzinga.com