Earnings Report
Amazon (AMZN) Q1 2026 Earnings Report
Summary
Amazon earned $30.3B this quarter, with revenue reaching $181.5B. AWS cloud computing is the real profit engine, e-commerce scale effects are increasingly visible, and AI investment continues to accelerate.
📊 Stock Price & Market Cap
Data as of: May 14, 2026
Stock Price (AMZN) $268.43 52-week range: $196.00 — $278.56
Market Cap $2.89T One of the top 5 companies by market cap globally
P/E Ratio 32.3x Forward P/E: 32.3x
In Plain Language
- Amazon's current market cap of $2.89T makes it one of the world's most valuable companies
- The stock at $268.43 is near its 52-week high of $278.56, reflecting strong market optimism about Amazon
- A P/E of ~32x is slightly higher than Microsoft, but given Amazon's growth rate and AWS's high margins, the market views this as reasonable
🏦 What Does Wall Street Think?
Data as of: May 2026 · Source: stockanalysis.com
Consensus Rating Strong Buy 41 analysts covering
12-Month Price Target $306.00 ↑ +14.0% vs. current price
In Plain Language
- Wall Street is nearly unanimous on Amazon: 39 out of 41 analysts recommend buying, 0 recommend selling
- Analysts believe Amazon's stock will reach $306 over the next 12 months on average, about 14% higher than the current $268
- The most bullish analyst believes Amazon will reach $370 in a year, the most conservative believes it could fall to $175
- Note: Analyst forecasts are for reference only. Historically, analyst price targets have not been highly accurate. Investing involves risk — please make your own judgment
💰 How Much Did They Earn?
| Metric | This Quarter (Q1 2026) | Last Quarter (Q4 2025) | Year Ago | YoY Change |
|---|---|---|---|---|
| Total Revenue | $181.5B | $187.6B | $143.4B | ↑ +26.5% |
| Operating Income | $23.9B | $21.3B | $15.4B | ↑ +55.2% |
| Net Income | $30.3B | $26.7B | $10.4B | ↑ +191.3% |
| EPS | $2.78 | $2.38 | $0.98 | ↑ +183.7% |
In Plain Language
- Amazon earns roughly $340M per day, or about $3,900 per second
- Net income grew nearly 3x year-over-year! This shows Amazon's profitability is surging dramatically
- Amazon does not separately disclose R&D expenses; they are included in "Technology and content" spend
- Revenue dipping vs. last quarter (Q4 is the holiday peak) is a normal seasonal pattern — year-over-year growth is what matters
📊 Where Did the Money Go?
| Expense Item | Amount | % of Revenue | Notes |
|---|---|---|---|
| Technology & Content | ~$29.0B | ~16% | R&D + AWS infrastructure + Prime Video content |
| Operating Costs | $157.6B | 87% | Warehousing, logistics, labor, fulfillment |
| Capital Expenditures | ~$25.0B | ~14% | Data centers, warehouses, robotics |
In Plain Language
- Amazon's "Technology and content" spend includes R&D, which Wall Street sees as a core competitive investment
- Capital expenditure is massive, primarily for building AWS data centers and e-commerce fulfillment networks
- AI-related investment (chips, models, infrastructure) is the primary driver of recent capex growth
🏢 Three Business Segments
Amazon's business is divided into three segments: North America e-commerce, International e-commerce, and AWS cloud
AWS (Amazon Web Services)
Cloud computing, AI services, databases, enterprise IT infrastructure
Revenue $29.0B ↑ +17% YoY
Operating Income ~$11.6B ↑ Sustained high growth
Margin ~40% ↑ Extremely high margin
In Plain Language
- AWS is Amazon's money printer: though it accounts for only ~16% of total revenue, it contributes the vast majority of profit
- AWS margins of ~40% mean for every $100 in revenue, $40 stays as profit — one of the most profitable businesses in tech
- Exploding AI demand is accelerating AWS growth further, as enterprises race to adopt cloud and AI
North America
US and Canada e-commerce + Prime membership + advertising revenue
Revenue $92.1B ↑ YoY growth
Operating Income ~$9.5B ↑ Margin expansion
Margin ~10% ↑ Scale effects showing
In Plain Language
- North America is the largest revenue source: ~51% of total revenue
- Margins improved from near 0% a few years ago to ~10%, thanks to scale effects and improved logistics efficiency
- Amazon's advertising business is growing rapidly and is a key driver of North America margin expansion
International
E-commerce in Europe, Asia, and other overseas markets
Revenue $60.4B ↑ YoY growth
Operating Income ~$2.8B ↑ Turned profitable
Margin ~5% ↑ Ongoing improvement
In Plain Language
- International moving from losses to profits: one of the biggest changes in recent years
- As Europe and emerging markets scale up, operational efficiency has improved dramatically
- International still has significant room for margin expansion compared to North America
🏦 How Strong is the Balance Sheet?
| Metric | End of Quarter (2026-03-31) | Prior Quarter | Notes |
|---|---|---|---|
| Total Assets | $916.6B | ~$890.0B | All assets on the balance sheet (cash + equipment + investments) |
| Cash Reserves | $101.8B | ~$88.0B | Cash and equivalents in the bank |
| Long-term Debt | $122.6B | ~$123.0B | Long-term borrowings |
In Plain Language
- Note: Total assets of $916.6B ≠ Amazon's market value. Amazon's market cap is ~$2.89T, more than 3x the book value. The gap comes from brand value, technology, and AWS's future potential
- Amazon holds $101.8B in cash. Even with $122.6B in long-term debt, this is completely manageable given its earning power
- Cash increased significantly (+$13.8B), indicating the business is generating strong free cash flow
- Debt is primarily used to finance infrastructure builds — part of Amazon's long-term strategy
📈 What Changed vs. Last Quarter?
Improvements
- Operating income up: $21.3B → $23.9B, +55% YoY
- Net income surged: $26.7B → $30.3B, all-time high
- Cash reserves grew: now holds over $100B in cash
Areas to Watch
- Revenue slightly down QoQ: $187.6B → $181.5B, a normal seasonal pattern (Q4 is the holiday peak)
- Capex remains elevated: massive AI and infrastructure investment ongoing
- Tariff uncertainty: trade policy changes could affect third-party sellers and e-commerce costs
📅 What Changed vs. One Year Ago?
| Metric | Q1 2025 | Q1 2026 | Change |
|---|---|---|---|
| Revenue | $143.4B | $181.5B | +26.5% |
| Operating Income | $15.4B | $23.9B | +55.2% |
| Net Income | $10.4B | $30.3B | +191.3% |
| EPS | $0.98 | $2.78 | +183.7% |
In Plain Language
- In one year, net income grew nearly 3x — an extremely rare growth rate, showing scale effects are exploding
- Revenue grew 26%, but profit grew faster (55%+), showing Amazon is becoming more efficient at making money
- AWS is the biggest contributor to all of this: high growth + high margins have driven a step-change in overall profitability
🎯 Key Points for Investors
1
AWS is the profit core
AWS accounts for only 16% of revenue but contributes the vast majority of profit. Cloud and AI demand continues to drive AWS's rapid growth
2
E-commerce scale effects finally showing
North America and International margins continue to expand, proving that Amazon's years of logistics investment are paying off
3
AI is the biggest growth catalyst
Amazon is investing heavily in AI infrastructure, and AWS's AI services (Bedrock, etc.) are growing rapidly
4
Tariff uncertainty is the biggest risk
Trade policy changes could impact e-commerce operations — the most important external risk factor to watch in 2026