Amazon (AMZN Quick QuoteAMZN - Free Report) reported first-quarter 2026 earnings of $2.78 per share. Excluding a pre-tax gain from the company's investment in Anthropic, adjusted earnings came in at $1.56 per share compared with the Zacks Consensus Estimate of $1.60. 

Net sales of $181.5 billion rose 17% year over year, ahead of management's prior guidance of $173.5-$178.5 billion. The figure beat the consensus mark by 2.07%. Top-line growth was driven by robust momentum across all three segments, with particularly strong performance in Amazon Web Services ("AWS").

Excluding the $2.9 billion favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 15% compared with the first quarter of 2025.

The company's profitability metrics showed solid performance, with net income reaching $30.3 billion, up 77% year over year. Operating income increased to $23.9 billion compared with $18.4 billion in the first quarter of 2025, representing 30% year-over-year growth. Worldwide operating margin expanded to 13.1%, the highest operating margin in Amazon's history.

Top-Line Details of AMZN

Net product sales increased 11% year over year to $71.3 billion. Net service sales jumped 20% from the year-ago quarter to $110.2 billion.

By segment, North America revenues rose 12% from the year-ago quarter to $104.1 billion. International revenues gained 19% year over year (11% excluding foreign exchange) to $39.8 billion.

AWS revenues rose 28% year over year to $37.6 billion, representing the fastest growth rate in 15 quarters. The acceleration was driven by both core and AI services as customers continue to modernize their infrastructure and migrate workloads to the cloud. AWS now has an annualized revenue run rate of $150 billion, adding $2 billion sequentially—the largest fourth-quarter to first-quarter increase in AWS history.

Strengthening relationships with third-party sellers remained a positive driver. In the reported quarter, sales generated by third-party seller services rose 14% on a year-over-year basis to $41.6 billion. Worldwide paid units grew 15% year over year, the highest quarterly growth rate since the tail end of COVID lockdowns. Worldwide third-party seller unit mix reached 60% of paid units.

Sales from advertising services increased 24% year over year to $17.2 billion. Advertising has now grown to over $70 billion in trailing 12-month revenues, reflecting successful AI-powered optimization of the platform and growing market share in digital advertising.
Physical store sales rose 5% year over year to $5.79 billion in the reported quarter.

The company's online store sales were $64.3 billion, up 12% year over year.

AMZN Prime and Consumer Business Performance in Q1

Amazon's Prime services demonstrated robust momentum in first-quarter 2026, with subscription services revenues reaching $13.4 billion, representing 15% year-over-year growth.

Amazon delivered more than 1 billion items same-day or overnight to date in 2026. The company launched Health AI on the Amazon U.S. app and website, bringing a 24/7 AI-powered personal health agent backed by One Medical clinicians. Virtual care visits have nearly tripled year over year, with a majority of those visits now via Health AI. Amazon also announced plans to expand Same-Day Amazon Pharmacy delivery to nearly 4,500 U.S. cities and towns by year-end, with expanded GLP-1 selection.

Amazon expanded Alexa+ to Mexico, the United Kingdom, Italy and Spain, and introduced new capabilities, including Alexa+ Personality Styles and Send to Alexa.

The company shared that Prime Day will take place in most countries in June, delivering savings to Prime members on millions of deals across more than 35 categories.

Project Hail Mary, an Amazon original film, generated nearly $615 million in global box office to date, anchored by an $80 million+ U.S./Canada opening weekend — only the second non-sequel, non-franchise film in the last decade to exceed this mark. Prime Video also debuted exclusive coverage of the NBA SoFi Play-In Tournament, averaging nearly 2.8 million U.S. viewers across six exclusive broadcasts, up 18% compared to last year on cable.

AWS and AI Innovations in Q1

Amazon's AI initiatives gained significant momentum during the quarter. AWS' chips business — inclusive of Graviton, Trainium, and Nitro — exceeded a $20 billion annual revenue run rate and is growing triple-digit percentages year over year.

The company secured a commitment from OpenAI to consume approximately 2 gigawatts of Trainium capacity through AWS infrastructure to power its frontier models and advanced workloads, beginning to ramp in 2027. Anthropic will secure up to 5 gigawatts of current and future generations of Amazon's Trainium chips to train and power its advanced AI models.

Amazon landed 2.1 million+ AI chips over the past 12 months, more than half of which were Trainium, and announced 1 million+ NVIDIA (NVDA Quick QuoteNVDA - Free Report) GPUs to be deployed starting in 2026, giving customers the widest range of accelerated compute options.

Amazon Bedrock processed more tokens in the first quarter than all prior years combined, with 170% growth in customer spend quarter over quarter. The company announced a collaboration with Cerebras to deliver the fastest AI inference speeds available for large language models through Amazon Bedrock.

Amazon partnered with Uber to put Graviton4 chips to work on millions of daily rides and deliveries, leveraging Trainium3 to train the AI models. The company signed an agreement with Meta to deploy tens of millions of AWS Graviton cores to power CPU-intensive workloads behind its agentic AI efforts.

AWS announced new agreements with major enterprises, including OpenAI, Anthropic, Meta Platforms (META Quick QuoteMETA - Free Report) , NVIDIA, Uber, U.S. Bank, Fox Corporation, Southwest Airlines, U.S. Army, Bloomberg, Cerebras, AT&T (T Quick QuoteT - Free Report) , DTCC, Nokia, The National Geographic Society, NEURA Robotics, DXC, PGA TOUR, O2 Telefónica, NTT DOCOMO, and many more.

The company announced the preview of Amazon Bedrock Managed Agents, powered by OpenAI, and announced OpenAI's GPT-5.4 model is available to customers in a limited preview on Amazon Bedrock, with GPT-5.5 coming soon. Amazon also announced the availability of Claude Opus 4.7 in Amazon Bedrock — Anthropic's most capable Opus model for coding, long-running agents, and professional work.

Amazon launched the Amazon Quick desktop app, which can query email, calendar, Slack, local files and several other applications to retrieve and summarize information, make recommendations and create agents that automatically do work. The company also expanded Amazon Connect to include Connect Decisions, Connect Talent, Connect Customer and Connect Health.

This Zacks Rank #3 (Hold) company more than doubled the number of developers using Kiro quarter over quarter, with enterprise customer usage increasing nearly tenfold. Amazon also launched Amazon Bio Discovery, an agentic AI application designed to accelerate drug discovery, which Memorial Sloan Kettering Cancer Center used to compress antibody design for potential pediatric cancer therapies from months to weeks. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Delivery and Logistics Growth in Q1

Amazon made Same-Day delivery even faster with new 1-hour and 3-hour delivery options on 90,000+ products in the United States. One-hour delivery is available in hundreds of cities and towns, and 3-hour delivery is available in 2,000+ cities and towns.

The company launched availability of Amazon Now (ultra-fast delivery in 30-minutes or less) in parts of Tokyo and eight major cities in Brazil, bringing total availability to tens of millions of customers across nine countries.

Amazon LEO Satellite Network

Amazon completed its tenth launch of Amazon LEO's satellites, bringing the number of satellites in orbit to 250+, with 20+ additional launches planned over the next year. Commercial service is on track for a third-quarter 2026 launch.

The company announced new customer agreements with Delta Air Lines to bring free, high-speed Amazon LEO-powered Wi-Fi to hundreds of aircraft beginning in 2028; Vodafone to extend mobile coverage across Europe and Africa; and the DP World Tour to provide satellite-powered connectivity across 42 professional golf tournaments annually.

Amazon also announced the planned acquisition of Globalstar, which will enable Amazon LEO to add direct-to-device services to its network, and that Amazon LEO will power satellite services for Apple iPhone and Apple Watch.

AMZN’s Q1 Operating Details

Operating income came in at $23.9 billion compared with $18.4 billion in the first quarter of 2025.

North America segment operating income was $8.3 billion, up 42% from the year-ago quarter. International segment operating income came in at $1.4 billion, up 40% year over year. AWS segment operating income was $14.2 billion, up 23% from the year-ago quarter, with an operating margin of 37.7%.

AMZN’s Q1 Balance Sheet & Cash Flow

As of March 31, 2026, cash and cash equivalents were $101.8 billion, up from $86.8 billion as of Dec. 31, 2025. Marketable securities totaled $41.3 billion as of March 31, 2026, up from $36.2 billion in the previous quarter.

Long-term debt was $119.1 billion at the end of the reported quarter, up from $65.6 billion at the end of the previous quarter.

Amazon's cash flow generation remained robust, with operating cash flow increasing 30% to $148.5 billion for the trailing 12 months compared to $113.9 billion in the prior-year period.

However, free cash flow decreased significantly to $1.2 billion for the trailing 12 months from $25.9 billion, driven primarily by a year-over-year increase of $59.3 billion in property and equipment purchases. This substantial capital investment primarily reflects investments in artificial intelligence.

Cash capital expenditures totaled $43.2 billion in the first quarter, primarily allocated to AWS and generative AI expansion. The company plans to invest approximately $200 billion in capital expenditures in 2026, predominantly in AWS.

Guidance

For the second quarter of 2026, Amazon provided guidance reflecting continued growth expectations. The company anticipates net sales between $194 billion and $199 billion, representing 16% to 19% growth compared to the second quarter of 2025, with this guidance anticipating an unfavorable impact of approximately 10 basis points from foreign exchange rates.

Operating income is expected to be between $20 billion and $24 billion compared with $19.2 billion in the second quarter of 2025. This guidance assumes that Prime Day occurs in the second quarter of 2026.