Q1 2026 Earnings — Reported April 29, 2026 · Record Operating Margin · AWS Fastest Growth in 15 Quarters
Revenue +17% to $181.5B · AWS +28% · Op. Margin 13.1% Record · EPS $2.78 Beat +70%
Amazon delivered its most profitable quarter ever — operating income of $23.9B at a record 13.1% margin, beating the top end of its own guidance by $2.4B. Revenue of $181.5B beat consensus by 2.4%. EPS of $2.78 beat $1.63 consensus by 70.5% — though $16.8B in pre-tax Anthropic investment gains added $1.24/share. AWS reaccelerated to 28% growth (fastest in 15 quarters), a $150B annualized run rate. Custom silicon crossed a $20B run rate growing triple digits. Advertising hit $17.2B (+22%). Q2 guidance of $194–199B was 4% above the $189B consensus. Stock fell ~2% on $43.2B quarterly CapEx and the $200B FY2026 capital plan.
Beats
Diluted EPSEst. $1.63$2.78 (+70.5%)
Net SalesEst. $177.3B$181.5B (+2.4%)
Operating IncomeGuide $16.5–21.5B$23.9B (+$2.4B above top)
AWS RevenueEst. ~26% growth$37.6B (+28% YoY)
Online Stores RevenueEst. $62.7B$64.3B (+12% YoY)
Q2 Revenue GuideCons. $189.2B$194–199B (+4%)
Concerns
Q1 Cash CapEx—$43.2B · AI infra surge
FY2026 CapEx Target—~$200B · on track
TTM Free Cash Flow—$1.2B · near zero
EPS quality$2.78 reported$1.24 from Anthropic gain
Q2 Op. Income — LEO costs—~$1B YoY headwind (Leo satellite)
Memory/storage cost inflation—Jassy flagged as margin risk
Select Consolidated Results — Three Months Ended March 31, 2026
Net Sales$181,483M$155,668M+17%
North America$104,062M$92,899M+12%
International$39,831M$33,510M+19%
AWS$37,590M$29,259M+28%
Online Stores$64,296M$57,368M+12%
Advertising Services$17,244M$14,098M+22%
Subscription Services$11,747M$10,722M+10%
Third-party seller services$38,683M$34,594M+12%
Operating Income$23,885M$18,414M+30%
North America Op. Income$8,272M$7,450M+11%
North America Op. Margin7.9%8.0%−10bps
International Op. Income$1,439M$903M+59%
International Op. Margin3.6%2.7%+90bps
AWS Op. Income$14,174M$11,509M+23%
AWS Op. Margin37.7%39.3%−160bps
Operating Margin (total)13.1%11.8%+130bps
Net Income$30,296M$17,127M+77%
Diluted EPS$2.78$1.56+78%
Anthropic gain (non-op.)$16.8B pre-tax—+$1.24/share
Adj. EPS (ex-Anthropic gain)~$1.54—Operational baseline
Q1 Cash CapEx$43,200M—AI infra
TTM Free Cash Flow$1,200M—Near zero
Earnings Verdict
AWS Reaccelerates to 15-Quarter High — CapEx Trajectory Is the Market's Defining Concern
Amazon's Q1 2026 was operationally the strongest in company history across multiple dimensions: record 13.1% operating margin, AWS at 28% growth (fastest in 15 quarters) on a $150B run rate, custom silicon crossing $20B and growing triple digits, retail unit growth at the highest pace since COVID, and Q2 guidance beating consensus by 4%. The operational quality of the quarter is exceptional. The market's −1.6% to −2.2% after-hours reaction is entirely about the $43.2B quarterly CapEx and the $200B FY2026 capital plan — compressing trailing free cash flow to $1.2B and signaling that Amazon is choosing infrastructure investment over near-term cash returns. The GAAP EPS of $2.78 was inflated by a $16.8B Anthropic investment gain ($1.24/share), so operational EPS is approximately $1.54 — still a beat but less dramatic than headlines suggest. The investment thesis rests on one question: does the $200B annual CapEx generate commensurate future AWS revenue and FCF? The Q1 AWS operating income of $14.2B on $37.6B revenue at a TTM margin of 35% provides strong evidence that each incremental dollar of cloud capacity deployed by Amazon earns a high return over its useful life. CEO Jassy's framing — that "CapEx investments fund assets with 30+ year useful lives and deliver cumulatively attractive FCF returns" — is the bull case in a single sentence. Next earnings July 29, 2026.
Next Earnings
Jul 29, 2026