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Amazon (AMZN) Q2 Revenue Jumps 13%
AmazonAmazon(US:AMZN) The Motley Foolยท2025-08-02 08:52

Core Insights - Amazon reported strong Q2 2025 earnings, exceeding analyst expectations with net sales of $167.7 billion and earnings per share of $1.68, driven by cloud computing, international operations, and advertising [1][2] - The company experienced a significant decline in free cash flow, raising concerns among investors despite operational outperformance [1][2] Financial Performance - Q2 2025 GAAP EPS was $1.68, surpassing the estimate of $1.33 and up from $1.26 in Q2 2024, reflecting a 33.3% year-over-year increase [2] - Revenue for Q2 2025 reached $167.7 billion, exceeding the estimate of $162.2 billion and showing a 13.3% increase from $148.0 billion in Q2 2024 [2] - Net income for Q2 2025 was $18.2 billion, a 34.6% increase from $13.5 billion in Q2 2024 [2] - Operating income for Q2 2025 was $19.2 billion, up 30.6% from $14.7 billion in Q2 2024 [2] - Free cash flow for the trailing twelve months was $18.2 billion, down 65.7% from $53.0 billion in Q2 2024 [2] Business Overview - Amazon operates across various sectors including e-commerce, cloud services (AWS), advertising, and logistics [3] - Recent priorities include enhancing customer experience, accelerating AI development, expanding cloud services, and investing in logistics [4] Key Growth Drivers - AWS sales increased by 17.5% to $30.87 billion, while advertising services revenue rose by 22% to $15.69 billion [5] - North America sales totaled $100.1 billion, an 11% year-over-year increase, and international sales climbed 16% to $36.8 billion [6] - Operational milestones included record sales during Prime Day and advancements in delivery capabilities [8] Future Outlook - Amazon projects Q3 2025 net sales between $174.0 billion and $179.5 billion, indicating a year-over-year growth rate of 10% to 13% [10] - Expected operating income for Q3 2025 is projected between $15.5 billion and $20.5 billion, compared to $17.4 billion in Q3 2024 [10] - Management highlighted potential risks from currency movements, geopolitical developments, and capital expenditure requirements [11][12]