Our guidance incorporates the order trends that we've seen to date and what we believe today to be appropriate assumptions. Our guidance assumes, among other things, that we don't conclude any additional business acquisitions, restructurings, or legal settlements. It's not possible to accurately predict demand for our goods and services, and therefore our actual results could differ materially from our guidance. Today we're reporting $167.7 billion in revenue, up 12% year over year, excluding the impact from foreign exchange rates.

Operating income was $19.2 billion, up 31% year over year, and trailing 12-month free cash flow was $18.2 billion. Outputs are metrics like revenue or operating margin, but of course, you can't manage at the output level. We've taken another step forward in selection these past few months, headlined by the much-requested return of Nike's products to Amazon's retail store. It's one of the reasons our everyday essentials growth outpaced the rest of the business globally and represented one out of every three units sold.

Perhaps the clearest outputs are the rate at which our stores business grew this past quarter and the success we saw in our recent Prime Day event. This year's Prime Day was our biggest ever, with record sales, number of items sold, and number of Prime sign-ups in the three weeks leading up to the Prime Day. What happens when we deplete the inventory we forward bought or that our selling partners forward deployed in advance of the tariffs going into effect? What we can share is what we've seen thus far, which is that through the first half of the year, we haven't yet seen diminishing demand nor prices meaningfully appreciating.

What went well
  • Worldwide operating income was $19.2B, up 31% year over year and $1.7B above the high end of guidance.
  • North America segment operating income rose to $7.5B (+$2.5B YoY) with operating margin of 7.5%, up 190bps YoY.
  • International segment operating income reached $1.5B (+$1.2B YoY) with operating margin of 4.1%, up 320bps YoY, continuing a ~700bps improvement over the prior 10 quarters.
  • Advertising revenue grew 22% YoY to $15.7B, driven by sponsored products and strong store traffic.
  • AWS grew 17.5% YoY to a $123B+ annualized run rate; backlog reached $195B, up ~25% YoY.
  • Biggest-ever Prime Day with record sales, items sold and Prime sign-ups; everyday essentials outpaced the rest of the business at one of every three units sold.
  • Record delivery speeds: 30% more items delivered same-/next-day in the U.S. YoY; deployed the one-millionth robot and rolled out DeepFleet AI (10% robot travel efficiency gain).
  • Third-party seller unit mix hit a record 62%, up 100bps YoY; trailing 12-month free cash flow of $18.2B.
What went wrong
  • AWS segment operating margin fell from a record 39.5% in Q1 to 32.9% in Q2; about half of the decline was a seasonal step-up in stock-based compensation, with additional headwinds from higher depreciation and unfavorable FX.
  • AWS remained capacity-constrained with more demand than supply (power the biggest constraint); Jassy said full resolution would take several quarters, not a couple.
  • AWS's 17.5% growth rate continued to trail the percentage growth of the #2 and #3 cloud players (off a larger base).

Guidance Changes

MetricPeriodCurrent guidance
Net salesQ3 2025$174.0B-$179.5B
Operating incomeQ3 2025$15.5B-$20.5B
FX impact on revenueQ3 2025~130bps favorable
Quarterly cash CapExH2 2025~$31.4B/quarter (Q2 reasonably representative)

Performance Breakdown

MetricYoYNote
Worldwide revenue +12% ex-FX ($167.7B) Broad-based strength across stores, ads and AWS; FX a $1.5B favorable impact; worldwide paid units +12%.
Worldwide operating income +31% ($19.2B) Cost-effective innovation and transportation/productivity gains across all segments; $1.7B above the high end of guidance.
AWS revenue +17.5% ($30.9B) Growth in both generative-AI and non-AI workloads as enterprises restart migrations; $123B annualized run rate.
AWS operating income n/a ($10.2B) Margin of 32.9%, down from 39.5% in Q1 on seasonal stock-based comp, higher depreciation from CapEx, and FX.
North America operating income +$2.5B ($7.5B) Transportation productivity, improved inventory placement and leverage on high unit volumes; margin 7.5% (+190bps).
International operating income +$1.2B ($1.5B) Established-country productivity plus emerging-market progress; margin 4.1% (+320bps).
Advertising revenue +22% ($15.7B) Sponsored products, strong store traffic and full-funnel offerings (DSP, Prime Video, live sports).
Cash CapEx n/a ($31.4B) Primarily AWS AI capacity and custom silicon (Trainium) plus fulfillment/transportation network investment.

Earnings Call Themes & Trends

TopicPrevious mentionCurrent periodTrend
AWS capacity vs. demandSupply constraints hoped to ease by back half of 2025More demand than capacity; power the single biggest constraint; several quarters to resolve
AWS segment marginRecord 39.5% in Q1 202532.9% in Q2 2025 on seasonal SBC, depreciation and FX
TariffsConcern over retail price and consumption impactNo diminished demand or broad ASP increases seen in first half of 2025
Custom silicon (Trainium2)Ramping capacityBackbone of Anthropic's newest Claude models and Bedrock; ~30-40% better price/performance than GPUs
International margins~700bps improvement over prior 10 quarters4.1% margin, up 320bps YoY

Q&A Summary

How are tariffs being absorbed across suppliers, Amazon and consumers, and is AWS's slower growth vs the #2/#3 players due to demand or supply? (Doug Anmuth, JPMorgan)
Jassy: outcome of tariffs is unknowable (especially China); through H1 no diminished demand and no broad ASP increases. On AWS, growth rates are a function of base size; AWS still leads on security, operational performance and end-to-end AI functionality; the constraint is that demand exceeds capacity at a $123B run rate that is still early.
Can you disclose the backlog, will supply constraints resolve in the back half, and how could Alexa+ show up financially? (Mark Mahaney, Evercore)
Dave Fildes: backlog was $195B at June 30, up ~25% YoY. Jassy: constraints span power (biggest), chips and components; won't be fully resolved for several quarters but improving. Alexa+ is far more capable, can take actions, is rolling out to millions; monetization via device sales, shopping, later advertising and potential subscription.
What are the drivers and sustainability of International revenue and margin gains, and where does Kuiper stand? (Colin Sebastian, Baird)
Olsavsky: established countries (UK, Germany, Japan) now near U.S. margins with strong transportation productivity; eight emerging countries improving quarter over quarter. Jassy: Kuiper will be one of two modern LEO providers with advantaged uplink/downlink and compelling pricing, seamless AWS integration; aiming for commercial beta late 2025/early 2026 despite rocket-launch delays.
What is your rebuttal to the narrative that AWS is falling behind in GenAI, and should AWS accelerate in H2/2026? (Brian Nowak, Morgan Stanley)
Jassy: AI is very early and top-heavy today; at scale 80-90% of cost will be inference, where price/performance matters and Trainium2 (30-40% better) plus NVIDIA give AWS an edge; Strands and AgentCore make agents easier to build and deploy; 85-90% of IT spend is still on-premises. Did not confirm acceleration.
How is Amazon adopting generative AI internally to improve speed to market? (Ron Josey, Citi)
Jassy: AI is the biggest technology transformation of our lifetime; Amazon is embracing and shaping it with coding agents (Cura/Kiro), Amazon Connect and business-process automation, letting teammates start from a more advanced point and invent for customers faster.
What are the drivers of the robust Q3 revenue guidance and how is Q4 shaping up? (Justin Post, Bank of America)
Olsavsky: cautiously optimistic; confident in controllable inputs (price, selection, convenience, delivery speed) and coming off a successful Prime Day, with uncertainty on where tariffs settle; no Q4 guidance provided yet.

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Reported 2025-07-31 · figures from the Amazon Com Inc Q2 2025 earnings call.

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