Amazon’s cloud business accelerated in the third quarter, while the cost of building capacity for artificial intelligence continued to absorb cash. Results published on 29 October show a company expanding sales and operating profit while making a much larger investment in infrastructure.
Total quarterly sales rose 12% to $201.9 billion. AWS revenue reached $46 billion, up 39.3% from a year earlier. Group operating income was $28.1 billion, with a record operating margin of 13.9%.
The cash-flow picture was different. Free cash flow was negative $42.4 billion over the twelve months ended 30 September. That is a trailing annual figure, not a loss incurred in this quarter. Amazon linked the decline primarily to higher purchases of property and equipment for AI.
Net income was $20.7 billion, below $21.2 billion a year earlier. Profit, operating cash flow and free cash flow measure different things: a company can report strong operating results while cash is committed to buildings, chips and other long-lived assets.
For the holiday quarter, Amazon forecasts sales of $240 billion to $247 billion. The timing of Prime Day also complicates the annual comparison: the event fell in the second quarter in most major markets this year, rather than entirely in the third quarter as in 2025.
The business question is how quickly the new capacity becomes productive. Rising cloud demand supports the investment case, but spending reaches the cash-flow statement before all the associated customer revenue arrives.
