Amazon’s revenues will be beaten all over, but stocks will drop as investors worry about trade headwinds
Amazon Robust reporting Second Quarter 2025 Financial Results On July 31, revenues grew sharply, surpassing Wall Street’s expectations, resulting in significant profits in key business segments. However, investor enthusiasm has been eased to reflect retail headwinds and lingering concerns about long-term spending plans, as the company’s shares fell by 3% in trading after opening hours.
From April to June, Amazon posted revenue of $167.7 billion, up 13% year-on-year, surpassing analyst forecasts of $162.1 billion. Earnings per share were $1.68, up by the expected $1.33. Quarterly net profit reached an impressive $18.2 billion, up over 10% from last year.
Amazon’s financial outperformance is attributed to strong execution in several areas. The vast retail business continues to be the biggest part of that business, but the real engine of profit growth remains the company’s cloud computing arm, Amazon Web Services (AWS).
AWS and AI Power Profitability
AWS generated revenue of $30.9 billion, up 17.5% year-on-year, landing straight ahead in line with industry forecasts. The unit has donated operating profit of $10.2 billion. That’s more than half of Amazon’s total operating profit of $19.2 billion for the quarter. This confirms AWS’ role as AWS’ Financial Powers. This is driven by a surge in demand for AI and cloud infrastructure as businesses accelerate their technology investments..
CEO Andy Jussy has put AI in the spotlight as Amazon’s transformational power, with most of 2025 in its 2025. Planned $100 billion in capital expenditure We are dedicated to expanding AWS’ capabilities for generation AI and machine learning. As key clients move more workloads to the cloud and adopt AI-driven services, AWS remains positioned for long-term leadership despite the short-term margin pressures from its large investments.
Retail and advertising show resilience
Despite ongoing concerns about tariffs and consumer spending, Amazon’s core online store sales rose 11% to $61.5 billion. The company’s third-party seller services also expanded, with revenues increasing by 11% to $40.3 billion. Physical stores, including Whole Foods, rose 7% to $5.6 billion, while subscription revenues (such as Prime membership) went from 12% to $12.2 billion.
Amazon’s ads segment is an outstanding performer, attracting revenue of $15.6 billion, up 23% from the previous year. The advertising business is becoming an increasingly important pillar within Amazon’s profit structure as brands compete for consumer eyeballs with the platform’s large shopping interface..
Issues and outlooks
The company navigates a complex macroeconomic climate that includes inflation, changes in trade policy and labor market constraints. Shipping costs increased by 6% to $23.4 billion. This reflects both global cost pressures and increased demand for fast delivery.
Amazon’s second quarter revenue does not reflect the impact of Prime Day in July after the quarter ends, but the company is optimistic and forecasts third quarter revenues in the range of $174 billion to $179.5 billion, exceeding analyst expectations. Operating profit is projected between $15.5 billion and $20.5 billion.
Meanwhile, Amazon’s personnel has increased by 1% year-on-year to 1.55 million, with CEO Andy Jassy being streamlined to internally gaining automation and generation AI traction. “Our advances in AI continue to improve customer experience, speed of innovation, operational efficiency and business growth. I am excited about what will come,” he said in a revenue press release.
Investor response
Despite bright revenue reports, Amazon’s stock has declined to extended trading, indicating Wall Street’s vigilance about the ongoing retail volatility of cloud and AI, capital-intensive growth and competitive dynamics. Still, analysts remain bullish on Amazon’s strategic direction, citing cloud innovation leadership, a resilient retail foundation, and a proactive expansion into the future of artificial intelligence..
For this story, luck Generated AI was used to assist with initial drafts. The editors checked the accuracy of the information prior to publication.