Amazon Reports Strong Q2 Earnings, AI and Chip Businesses Surpass $25 Billion Run Rate
Amazon (AMZN) reported second-quarter earnings that significantly exceeded expectations with revenue of $200.6 billion and EPS of $5.75 compared to analyst forecasts of $197.01 billion in revenue and $1.82 per share. The company's AWS segment saw a 36.7% year-over-year growth, while its AI and chip businesses each surpassed an annual run rate of over $25 billion. Amazon stock surged approximately 13% in premarket trading following the results. The strong performance was attributed to robust growth across multiple segments including Stores, where delivery speeds for Prime members improved significantly, and Advertising, which grew by 26%. However, free cash flow declined sharply due to heavy investments in AI. The report follows similar positive earnings from Microsoft (MSFT) but contrasts with a drop in Meta's stock after it missed guidance. Amazon is also expanding its chip sales business, renting capacity to companies like Meta and OpenAI, and exploring direct sales of chips for customer data centers.
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Topics: AI Amazon AWS Earnings Beat Stock Movement