Cloudy With a Chance of Billions: Amazon’s AI-Fueled Earnings Send Stock Sky High -( $AMZN $SPY $GOOG $MSFT )

By John F. Heerdink, Jr.

Amazon’s (AMZN) third-quarter results delivered a thunderous beat over Wall Street’s expectations, driving a more than 13% surge in its share price after hours and confirming that its cloud and artificial intelligence investments are bearing fruit. The e-commerce and tech giant posted $180.2 billion in revenue—a 13% year-over-year rise—and adjusted earnings per share of $1.95, outpacing consensus forecasts by a sizable margin. The key growth engine: Amazon Web Services (AWS), whose revenue jumped 20% to $33 billion, its fastest pace in over a year, propelled by waves of enterprise demand for artificial intelligence capabilities and robust core infrastructure usage. This comes as the cloud space heats up, with AWS working to defend its lead as Microsoft and Google also post blockbuster cloud growth.

AWS Accelerates, Powered by AI

AWS reported its sharpest growth rate since 2022, hitting an annualized run rate of $132 billion. While Google Cloud (GOOG) and Microsoft’s (MST) Azure posted 34% and 40% gains respectively, AWS remains the backbone of Amazon’s profitability and a magnet for AI-related workloads. Notably, Amazon inaugurated its $11 billion AI data center, Project Rainier, underscoring its commitment to serving the world’s hunger for generative AI and custom silicon.

Executive Commentary

CEO Andy Jassy lauded the quarter’s results: “AWS is growing at a pace we haven’t seen since 2022,” pointing to “surging demand for cloud and AI services.” Jassy added, “AI is facilitating significant enhancements in every part of our business,” and emphasized AWS’s expanding critical infrastructure for enterprise customers. On broader strategy, he stated, “We’re committed to operating like the world’s largest startup… AI and agentic commerce are going to change the experience online. As fast as we’re adding capacity right now, we are monetizing it.” Addressing the scale of AWS, Jassy told analysts: “It’s very different having 20% year-over-year growth on a $132 billion annualized run rate than to have a higher % growth rate on a meaningfully smaller annual revenue, which is the case with our competitors.”

Analyst and Market Reactions

FactSet analysts were surprised by how Amazon “easily beat expectations” and noted, “Operating income rose 9% from a year ago as AWS maintained its top spot in world cloud infrastructure, despite intensifying pressure from Google and Microsoft.” StreetAccount further highlighted that “the company’s performance offered investors a sigh of relief, particularly as Amazon’s stock has been the laggard of the Magnificent Seven this year.”

Robust Growth Beyond Cloud

Amazon’s advertising business jumped 22% year-over-year to $17.7 billion, while North American retail also posted double-digit growth. Despite a $4.3 billion drag from special charges—including a major FTC settlement and severance costs—the underlying business momentum remains strong. For the year-end quarter, Amazon forecasted sales between $206–$213 billion, maintaining a bullish tone for the holidays despite macroeconomic uncertainty.

A New Trajectory

The confluence of strong results, bullish executive commentary, and endorsement by the analyst community paints a picture of a company recapturing momentum in technology and retail. Amazon’s latest quarter signals its deepening entrenchment as a global cloud and AI powerhouse, powering enterprise transformation even as competitive and economic crosswinds remain ever-present.