# Amazon Q3 earnings miss estimates as AWS growth accelerates to 39% and capex hits $220B

Digest AI · Business & Funding · published 2026-11-02T00:16:00Z

Canonical: https://digestai.news/story/amazon-q3-earnings-miss-estimates-as-aws-growth-accelerates-to-39-and

## Summary

Amazon reported third-quarter earnings of $1.89 per share, missing the Zacks Consensus Estimate of $2.01. Revenue rose 12% year over year to $201.94 billion, just below the $202.11 billion expected. Operating income surged 61% to $28.1 billion, giving a record operating margin of 13.9%.

AWS revenue jumped 39% to $46 billion, its fastest growth in nearly five years, with AWS operating income up 55% to $17.8 billion. CEO Andy Jassy projected AWS revenue growth exceeding 40% in both 2027 and 2028. Amazon reaffirmed a $220 billion capital expenditure outlook for 2026, mainly for AI infrastructure. Free cash flow was negative $33.5 billion in the quarter, with a trailing 12-month outflow of $42.4 billion versus a positive $14.8 billion a year earlier.

## Key points

- Q3 EPS $1.89 vs $2.01 estimate; revenue $201.94B vs $202.11B estimate
- AWS revenue up 39% YoY to $46B; operating income up 55% to $17.8B
- Capex outlook $220B for 2026; Q3 free cash flow negative $33.5B

## Why it matters

Amazon's heavy AI spending is pressuring cash flow even as AWS growth accelerates, a pattern also seen at Alphabet that investors are weighing against long-term cloud prospects.

## Sources

1. [Zacks Investment Ideas feature highlights: Amazon, Alphabet, Meta Platforms and Nvidia](https://finance.yahoo.com/markets/stocks/articles/zacks-investment-ideas-feature-highlights-081600916.html) (finance.yahoo.com, 2026-11-02)

Part of the developing story: [Amazon AI Cloud Investment Earnings Tension](https://digestai.news/thread/morgan-stanley-raises-amazon-price-target-to-350-on-ai-cloud-outlook) (2 stories)

## Cite

Digest AI, "Amazon Q3 earnings miss estimates as AWS growth accelerates to 39% and capex hits $220B", 2 November 2026, https://digestai.news/story/amazon-q3-earnings-miss-estimates-as-aws-growth-accelerates-to-39-and

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