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Amazon Q3 Earnings 2025: Amazon shares jumped 12% on Friday after the company posted stronger-than-expected results for the third quarter and raised its spending outlook to meet rising demand for artificial intelligence services.
A major highlight of the report was Amazon Web Services (AWS), which continues to drive both revenue and profit growth. The cloud unit recorded a 20% year-over-year increase in sales, reaching $33 billion and surpassing analyst expectations.
The strong performance reflects how Amazon’s cloud and AI investments are paying off, reinforcing its position as a key player in the global tech and cloud computing markets.
Amazon’s cloud division posted an operating income of $11.4 billion in the third quarter, making up nearly two-thirds of the company’s total operating profit.
The company’s digital advertising business also continued its strong momentum, with revenue climbing 24% to $17.7 billion.
Overall sales rose 13% from a year earlier to $180.17 billion, beating analysts’ projections of $177.8 billion, according to LSEG data.
Earnings per share came in at $1.95, comfortably above the market estimate of $1.57, highlighting another quarter of robust growth across Amazon’s key business segments.
Analysts at Pivotal Research said Amazon’s core businesses remain strongly protected by its vast scale, giving the company a significant competitive edge.
In a note released after the earnings report, the analysts maintained a buy rating on the stock, citing Amazon’s solid prospects for continued organic growth.
They highlighted the company’s high-margin cloud division, Amazon Web Services, and its growing advertising business as major engines for future expansion.
Ahead of its earnings announcement, Amazon’s cloud division was under close scrutiny as competition from Google and Microsoft continued to intensify.
Both tech giants posted strong quarterly results earlier in the week, with Google’s cloud revenue rising 34% and Microsoft’s Azure business expanding 40% in the third quarter.
By comparison, Amazon’s stock had climbed just 1.6% so far this year before the results were released, lagging behind other megacap technology peers.
Amazon remains the dominant force in the cloud infrastructure market, but some investors have questioned whether it is falling behind in capturing high-value artificial intelligence cloud deals.
However, when it comes to investment, Amazon continues to outspend its rivals, reinforcing its leadership in cloud technology and its commitment to advancing AI capabilities.
Amazon has increased its capital spending outlook for the year, now projecting $125 billion in expenditures for 2025, up from a previous estimate of $118 billion. Chief Financial Officer Brian Olsavsky said the company expects that figure to rise even higher in 2026.
Tech peers including Google, Meta, and Microsoft have also raised their capital spending forecasts, but their projections remain below Amazon’s.
Looking ahead, Amazon anticipates revenue between $206 billion and $213 billion for the current quarter. The midpoint of that range, $209.5 billion, comes in ahead of analyst expectations of $208 billion, according to LSEG data.
Even as Amazon’s latest earnings report lifted investor sentiment, the company’s employees are facing a difficult week.
On Tuesday, Amazon announced plans to lay off 14,000 corporate workers as part of an effort to make the organization more agile and less bureaucratic.
The goal, executives said, is to help the company respond faster to changing business needs.
More job cuts are expected in the near future. CEO Andy Jassy emphasized that the decision was not “financially driven” and is not linked to artificial intelligence — “at least for now.”
“It’s really about culture,” Amazon CEO Andy Jassy said. “When a company grows as quickly as we have — expanding in size, adding new teams, locations, and business areas — it naturally leads to more people and additional layers of management.”
Amazon closed the quarter with approximately 1.58 million employees, a 2% increase from the same period last year.
The company’s core online retail business recorded a 10% rise in sales for the quarter, boosted in part by strong performance during its Prime Day event in July.
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