Amazon Crushes Q3 Stock Surges on AI-Driven Growth

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•  30 Oct 2025
 

•   AMZN  
   
  +2.30%

$AMZN delivered Thursday night, and the 9% after-hours move tells you the market wasn't expecting this kind of beat. Earnings per share hit $1.95 against $1.58 consensus, with revenue at $180.2 billion versus $177.8 billion expected. That's 13% year-over-year growth, but the real story is in the acceleration.

AWS grew 20% to $33 billion, the fastest pace since 2022. If you've been watching the cloud spending narrative, you know this matters. Enterprise AI infrastructure demand is real, and Amazon positioned to capture it. They just launched Project Rainier with nearly half a million custom Trainium2 chips, purpose-built for AI workloads. This isn't speculative positioning, it's operational capacity coming online now.

Net income jumped to $21.2 billion from $15.3 billion last year, boosted by a $9.5 billion gain from their Anthropic stake. Strip out the $4.3 billion in one-time charges for FTC settlements and severance, and adjusted operating income would have reached $21.7 billion. The underlying business is generating significant cash while funding heavy infrastructure investment.

North American sales grew 11% to $106.3 billion, international climbed 14% to $40.9 billion. The retail foundation remains solid, but AWS is driving the revaluation. Management guided Q4 revenue to $206-213 billion with operating income of $21-26 billion, reflecting continued confidence in demand momentum.

The setup here matters for position management. If you're holding, this quarter validated the AWS growth thesis and confirmed Amazon can scale AI infrastructure while maintaining profitability. If you're evaluating entry, you're chasing a 9% gap but getting exposure to 20% cloud growth with improving margins. The risk is whether this pace sustains or if we see deceleration as comps get tougher.

This strength offers liquidity to rebalance without selling weakness. For those underweight, the opportunity cost of waiting for a pullback needs to be weighed against momentum that may extend. The stock is reacting to fundamentals, not sentiment, which typically provides more durable moves.

AWS at 20% growth, custom silicon reducing costs, and expanding market share in AI infrastructure creates a compounding setup. The question is valuation and timing. After a 9% pop, some profit-taking is rational. But if enterprise AI spending is still early cycle, the growth runway extends further than current multiples reflect. That's the call you need to make based on your risk parameters and time horizon.

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