Amazon’s stock price jumped more than 9% in after-hours trading on Thursday after the retail-and-AI giant reported second-quarter results buoyed by its Amazon Web Services cloud business, which is racing faster ahead than it has in more than four years.
The cloud unit posted $42.2 billion in revenue in Q2, up 37% from $30.9 billion a year ago, marking AWS’ fastest growth in 18 quarters, and what Amazon CEO Andy Jassy called its fifth consecutive quarter of accelerating growth. AWS added more than $4.6 billion in revenue quarter over quarter, and AWS operating income hit $16.6 billion, up 64% from $10.2 billion a year ago, on a 39.4% margin, up from 32.9% in the same period a year ago. AWS’s backlog—customer agreements representing future revenue—grew to $496 billion.
“AWS is now a $169 billion dollar annualized revenue run rate business, which, for perspective, would place it 24th on the Fortune 500 list if it was a standalone company,” Jassy said during Thursday’s earnings call.
Across all of Amazon businesses including stores, advertising, Prime, devices, and cloud, net sales rose 20% to $200.6 billion, compared with $167.7 billion a year earlier. Operating income surged to $27.5 billion, from $19.2 billion. Net income hit $62.6 billion, or $5.75 per diluted share, compared with $18.2 billion, or $1.68 per share, a year ago—with a caveat that the net-income figure includes $53.4 billion in non-operating income primarily from Amazon’s investments in Anthropic. Advertising, one of the unsung heroes of Amazon’s business, grew 26% year-over-year, up from 22% growth a year ago when the segment hit $15.7 billion.
