Amazon Q3 earnings beat expectations as AWS growth hits 20%

Core Insights - Amazon reported $180.2 billion in revenue and a $1.95 EPS, with a 20% growth in AWS, marking its strongest growth in over a year [1][2] - The company's shares surged approximately 13% in after-hours trading, indicating a positive market reaction [1] - AWS's revenue increased to $33 billion, surpassing analysts' expectations of around 18% growth [2] Financial Performance - Overall revenue grew by 13% year-over-year, with profits exceeding expectations and guidance for the holiday quarter remaining steady to slightly higher [1] - Operating cash flow rose 16% to $130.7 billion, while free cash flow decreased to $14.8 billion due to a significant increase in capital expenditures, which surged by roughly $51 billion year-over-year [5] AWS Growth and Strategy - AWS's 20% revenue growth was a relief for investors, especially in light of competition from Microsoft and Google, which reported higher growth rates of 40% and 34% respectively [2] - The company has invested around $100 billion in data-center expansions and chip capacity, enhancing its infrastructure to support cloud services [3] - CEO Andy Jassy highlighted that AWS is experiencing growth momentum driven by AI, with plans to double capacity by 2027 [4] Market Sentiment - Analysts view this quarter as a potential turning point for Amazon, suggesting it could reclaim a leadership role among large-cap tech stocks as investment sentiment shifts positively [5]