Amazon Reports Q3 Revenue and Earnings Miss Despite Strong AWS Growth

Amazon.com, Inc. released its financial results for the quarter ending September 2026, revealing a narrow miss on both revenue and earnings per share compared to Wall Street projections. The company reported overall revenue of $201.94 billion, marking a 12.1 percent increase over the same period last year. However, this figure fell slightly short of the Zacks Consensus Estimate of $202.11 billion by 0.08 percent.

Earnings per share for the quarter came in at $1.89, failing to meet the consensus estimate of $201.11 billion and dropping from the $1.95 reported in the year-ago quarter. The EPS shortfall represented a negative surprise of 5.97 percent, drawing scrutiny from investors as they assess the company's financial health and upcoming stock price performance.

Despite the top- and bottom-line misses, Amazon Web Services delivered standout performance. Net sales for AWS reached $45.98 billion, beating the average analyst estimate of $45.42 billion and demonstrating a year-over-year surge of 39.3 percent. AWS revenue growth accelerated alongside expanding margins, with management projecting 40 percent growth for the division through 2027 and 2028.

Other segments of the business saw mixed results during the quarter. Subscription services brought in $14.01 billion, topping the estimated $13.69 billion and representing an 11.4 percent increase year over year. Third-party seller services also exceeded expectations, generating $46.49 billion compared to the anticipated $44.83 billion, marking a 9.4 percent rise from the previous year.

Conversely, certain core areas lagged behind analyst projections. Advertising services brought in $19.64 billion, missing the projected $20.87 billion, though it still represented a 10.9 percent increase from the year-ago quarter. Online stores generated $68.47 billion, falling short of the $69.56 billion estimate while posting a modest 1.6 percent year-over-year change.

Geographically, North American net sales reached $112.85 billion, slightly below the estimated $113.39 billion but up 6.2 percent from the prior year. International net sales totaled $43.11 billion, narrowly missing the $43.21 billion analyst consensus while achieving a 5.4 percent increase compared to the same period in 2025.

The financial report also highlighted heavy artificial intelligence-driven capital expenditures, which resulted in negative free cash flow for the period. Nevertheless, market demand visibility remains robust, and analysts note that Amazon continues to secure strong backing even as market anxieties and post-earnings stock adjustments prompt a close look at its future trajectory.