Amazon Q3 revenue up 12%, AWS jumps 39%, free cash flow turns negative

Amazon reported Q3 2026 net revenue of $201.94 billion, up 12% year-over-year, while AWS revenue surged 39% to $45.98 billion, its fastest growth in nearly five years. However, free cash flow turned negative over the past 12 months due to heavy AI infrastructure spending. Operating income rose 61% to $28.08 billion with a record 13.9% operating margin, but net income fell 2% to $20.69 billion, primarily due to a $9.5 billion prior-year gain from Anthropic investment. North American retail operating profit jumped 82%, while advertising and subscription revenue each grew 11%. Capital expenditures on property and equipment reached $77.26 billion in Q3, up 120%, driving 12-month free cash flow to negative $42.36 billion versus positive $14.79 billion a year earlier. Amazon guides Q4 revenue between $240 billion and $247 billion, with operating profit of $28.5–$33.5 billion.