Amazon.com has released its first quarter 2026 earnings, with results that smashed Wall Street forecasts, especially in its AWS (Amazon Web Services) division.
For the quarter ending March 31, Amazon reported total sales of $181.5 billion, surpassing consensus estimates that ranged from $176.98 billion to $177.3 billion and representing a 17% year-over-year increase. Diluted earnings per share came in at $2.78, far above analyst expectations of $1.62 to $1.63.
A standout highlight was AWS net sales, which jumped 28% YoY to $37.6 billion, handily beating the anticipated $36.8 billion. Operating income surged to $23.9 billion, outpacing estimates of $20.9 billion and well above the $18.4 billion reported in 1Q25.
Amazon reported net income of $30.3 billion for the quarter, a sharp increase from $17.1 billion in 1Q25. Non-operating income included $16.8 billion in pre-tax gains from its investment in Anthropic, an AI startup.
Operating cash flow for the trailing twelve months (TTM) jumped 30% YoY to $148.5 billion, while free cash flow stood at $1.2 billion, down from $25.9 billion for the period ending March 31, 2025. Purchases of property and equipment soared by $59.3 billion year-over-year, reflecting the company’s aggressive investment in AI and technology infrastructure.
Looking ahead to the second quarter, Amazon expects sales in the range of $194 billion to $199 billion, again surpassing the analysts’ estimate of $189 billion. This translates to 16% to 19% YoY growth. Projected Q2 operating income is set between $20 billion and $24 billion, compared to the market consensus of $22.9 billion and last year’s $19.2 billion.
For the full fiscal year 2026, capital expenditure guidance remains robust at around $200 billion, in line with market expectations, emphasizing continued investment in technology and infrastructure.
Amazon’s chips business rocketed past a $20 billion annual revenue run rate, with triple-digit percentage growth year-over-year. Advertising revenue topped $70 billion on a TTM basis, underlining the segment’s ongoing importance.
Store unit growth soared by 15%, marking the strongest expansion since the final stages of the COVID-19 pandemic lockdowns. The company’s AI chip production reached 2.1 million units delivered over the past year, with more than half consisting of its Trainium models. Amazon also announced it will deploy over 1 million NVIDIA GPUs starting in 2026, signaling a massive expansion in its AI infrastructure.
Bedrock, Amazon’s generative AI platform, processed more tokens in Q1 than in all prior years combined, with customer spend leaping 170% quarter-on-quarter. On the developer front, its Kiro platform saw user numbers more than double, and enterprise customer usage increased nearly tenfold.
Logistics innovations included over 1 billion same-day or overnight deliveries in 2026 so far. Amazon Leo, the company’s satellite initiative, now has 250+ satellites in orbit with over 20 launches planned in the coming year.
