So Amazon decided to casually drop a 10% stock surge on Friday like it was no big deal. You know, just another day at the office for Jeff Bezos’s baby.
Here’s what went down: Amazon absolutely crushed their Q3 earnings, and by crushed, I mean they didn’t just beat Wall Street’s expectations—they grabbed those estimates, dunked on them, and then did a victory lap around the trading floor.
The Numbers That Made Wall Street Swoon:
- Net sales hit $180.2B (up 13% year-over-year) vs. the expected $177.8B
- Net income jumped to $21.2B—that’s a 38% increase, folks
- Earnings per share came in at $1.95, absolutely demolishing the $1.57 estimate
But here’s where it gets really spicy: AWS (that’s Amazon Web Services for those keeping score at home) was the real MVP of this earnings party. While everyone’s been obsessing over AI and whether robots will take our jobs, Amazon’s been quietly building the infrastructure that powers half the internet.
AWS revenue shot up 20% to $33 billion, and operating income rose about 10% to $11.4 billion. To put that in perspective, AWS is basically printing money faster than the Federal Reserve during a crisis.
The Plot Twist Nobody Saw Coming
Remember that $9.5 billion profit boost from “non-operating income”? That’s Amazon’s investment in Anthropic PBC paying off big time. You know, the AI company that’s supposed to make AI “safer.” Turns out betting on the future of artificial intelligence was a pretty smart move. Who could have predicted that? (Everyone, but whatever.)
Meanwhile, the e-commerce side had some mixed results. North American revenue grew 11% to $106.3 billion, but profits took a 14% hit thanks to a $2.5 billion legal settlement with the FTC. International e-commerce saw revenue jump 14%, but operating income fell 8% due to some strategic “workforce optimization”—corporate speak for “we’re laying off 14,000 people.”
What’s Next for the Everything Store?
Amazon’s feeling pretty confident about Q4, projecting net sales between $206-213 billion. That’s 10-13% growth, which in today’s economic climate is basically showing off.
Wall Street is eating this up like it’s Prime Day for analysts. Telsey, RBC, and TD Cowen all bumped their price targets to $300 per share. With Amazon currently trading around $247, that suggests some serious upside potential.
The best part? Amazon isn’t even ridiculously overvalued right now, trading at 33 times earnings. In a world where some tech stocks are priced like they’ve discovered the secret to eternal life, Amazon’s valuation actually looks… reasonable?
So there you have it: Amazon just reminded everyone why they’re the undisputed king of “we do everything, and we do it better than you.” AWS continues to be their golden goose, and apparently, betting on AI companies that want to save humanity from AI is working out pretty well too.
Not bad for a company that started selling books out of a garage.