Amazon misses by $0.02, reports revs in-line; guides Q1 revs in-line; to invest about $200 bln in cap-ex across Amazon in 2026 (222.69 -10.30)
- Reports Q4 (Dec) GAAP earnings of $1.95 per share, $0.02 worse than the FactSet Consensus of $1.97; revenues rose 13.6% year/year to $213.39 bln vs the $211.44 bln FactSet Consensus.
- North America segment sales increased 10% yr/yr to $127.1 bln.
- International segment sales increased 17% yr/yr (+11% CC) to $50.7 bln.
- AWS segment sales increased 24% yr/yr to $35.6 bln.
- Q4 adjusted operating income of $27.4 bln vs prior guidance of $21-26 bln.
- Co issues in-line guidance for Q1, sees Q1 revs of $173.50-178.50 bln vs. $175.62 bln FactSet Consensus. Co guides to Q1 operating income of $16.5-21.5 bln.
- "AWS growing 24% (our fastest growth in 13 quarters), Advertising growing 22%, Stores growing briskly across North America and International, our chips business growing triple digit percentages year-over-year—this growth is happening because we're continuing to innovate at a rapid rate, and identify and knock down customer problems," said Andy Jassy, President and CEO, Amazon.
- "With such strong demand for our existing offerings and seminal opportunities like AI, chips, robotics, and low earth orbit satellites, we expect to invest about $200 billion in capital expenditures across Amazon in 2026, and anticipate strong long-term return on invested capital."
- Co says it expects to invest about $200 mln in capital expenditures across Amazon in 2026, and anticipates strong long-term return on invested capital.
Q4 2025 Earnings Call Guidance
- Q1 2026 net sales expected between $173.5B and $178.5B; guidance anticipates a favorable FX impact of approximately 180 bps.
- Q1 2026 operating income expected between $16.5B and $21.5B.
- Within North America segment, expected YOY cost increase of approximately $1B in Q1 2026 related to Amazon Leo, driven by higher satellite launch spending.
- Amazon Leo: more than 20 launches planned in 2026 and more than 30 in 2027; select enterprise customers testing services now; wider commercial rollout expected later in 2026.
- Amazon Leo accounting: many costs such as satellite manufacturing and launch services expected to be capitalized later in 2026 (currently mostly expensed as incurred).
- International segment: continued incremental investment in stores to enhance customer experience and accelerate online retail adoption, including expansion of ultra-fast “Amazon Now” 30-minute delivery; management expects these investments to “generate long-term positive return on invested capital.”
- Capital expenditures: Amazon expects to invest about $200B in capital expenditures across the company, predominantly in AWS, citing “very high demand” and monetizing capacity “as fast as we can install it.”
- Trainium3: up to 40% more price performance than Trainium2; Amazon expects nearly all Trainium3 chip supply to be committed by mid-2026.
- Amazon Leo commercial launch expected in 2026.
- Whole Foods Market: plan to open more than 100 new stores over the next few years.
- Same-day perishables: plan to expand same-day perishable grocery delivery to many more US communities in 2026.
- FactSet Q1 2026 revenue consensus is $175.62 bln.