Amazon on deck to report earnings after the bell with cloud, capex in focus
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- Amazon is set to report Q2 earnings after Thursday's bell, with analysts expecting EPS of $1.82 on revenue of $196.47 billion (LSEG); advertising revenue is expected at $19.43 billion (StreetAccount).
- Amazon Web Services revenue is expected at $40.54 billion, with planned growth of ~31% year-over-year versus 28% growth in Q1, which was its fastest expansion in more than three years.
- Amazon's Q2 capital expenditures are expected to reach $49.3 billion, up from $44.2 billion in Q1 (+77% YoY), with Morgan Stanley projecting 2026 capex of $218 billion and $318 billion by 2028, citing the 'ecosystem remains compute-constrained.'
- Amazon struck a deal with Meta in April to supply AWS Graviton chips and has deepened cloud and chips partnerships with OpenAI and Anthropic, which Morgan Stanley calls a catalyst for 'multi-year growth durability.'
- The hyperscaler capex mood has grown 'jittery' — Alphabet shares sank after hiking its 2026 capex forecast to as high as $205 billion, while Microsoft surged as much as 15% on earnings and Meta's stock tumbled 9% on a light current-quarter revenue forecast.
- Amazon moved its Prime Day to June 23-26 from its typical July slot, with U.S. online spending during the event growing 9.3% YoY to $26.4 billion (Adobe); Mizuho warned the timing shift could cause a Q3 North America retail growth slowdown before a Q4 reacceleration.
- Amazon has trimmed corporate headcount with layoffs in customer service, seller support, and its AGI unit, following the departure of its AGI Lab head after a new AGI leader was installed.
Why it matters: Amazon's Q2 print arrives after sharp market dispersion: Microsoft surged 15% on results, while Meta dropped 9% and Alphabet sank after a capex hike to $205B. Amazon's expected $49.3B Q2 capex and 31% projected AWS growth put it between the two camps, with several analysts expecting a 2026 forecast lift.
