Amazon (AMZN) earnings preview: what to watch in Q3 2026

Amazon reports its third-quarter 2026 results, for July to September, on Thursday, October 29, 2026. The date comes from the earnings-call event page on Amazon's own investor-relations site. The quarter will look slower than the last one partly for a timing reason: Prime Day moved.

What last quarter showed

Our analysis of Amazon's Q2 2026 results found two separate stories:

• Sales rose 19.6% to $200.6 billion and operating income (profit from running the business, before interest, investment gains and tax) rose 43.2% to $27.5 billion. Operating margin, the share of sales left as operating profit, rose to 13.7% from 11.4%.
• Amazon Web Services (AWS), the cloud unit, grew 36.8% to $42.2 billion, up from 28.4% growth in Q1, and earned $16.6 billion of operating profit, 61% of Amazon's total.
• Net income of $62.6 billion and diluted EPS of $5.75 were mostly a non-cash gain: $50.5 billion came from marking up Amazon's stake in AI lab Anthropic.
• Free cash flow (operating cash flow minus spending on buildings and equipment) was negative $7.7 billion, as capital spending reached $53.1 billion. Long-term debt nearly doubled in six months to $128.9 billion.

What management guided for this quarter

Amazon's guidance for Q3 2026, given on July 30:

• Net sales of $197.0–202.0 billion, growth of 9–12%. Amazon said growth would be "nearly 400 basis points higher" (about 4 percentage points) without the Prime Day shift, and expects currency to reduce growth by about 0.8 points.
• Operating income of $22.5–26.5 billion, against $17.4 billion in Q3 2025. The $24.5 billion midpoint would be up about 41%.
• The guidance assumes no effect from remeasuring energy contracts, which added a $551 million gain in Q2.

Because Prime Day fell in Q2 this year and in Q3 last year, Q3 sales may come in below Q2's. Read the year-over-year rate against the 9–12% range, not against Q2's 19.6%.

Three things to watch

1. Whether AWS keeps growing near 37%. AWS growth jumped from 28.4% to 36.8% in one quarter, backed by about $496 billion of contracted revenue not yet earned. AWS operating margin was 39.4%, or about 38.1% without the energy-contract gain. With no such gain assumed in the guidance, an AWS margin near 38% would match Q2's underlying level. AWS depreciation rose 67% in Q2, faster than its sales, so a margin falling well below 38% would show build-out costs catching up.

2. North America margin without the one-offs. North America's Q2 operating margin was 7.85%, but that included about $640 million of tariff refunds that Amazon said were "the significant majority" of what it expects. Without them the margin was about 7.3%, lower than a year earlier. Q3 has neither the refund nor Prime Day, so it is a cleaner test of whether retail margins are still improving.

3. Cash, debt and the receivables build. Capital spending of $53.1 billion in Q2 exceeded operating cash flow of $45.4 billion, and Amazon issued another $25.0 billion of debt in July at 4.60% to 6.25%. Interest expense already rose from $516 million to $1,314 million. Watch whether free cash flow turns positive and whether "accounts receivable, net and other", which rose 30% in six months while sales rose 18%, keeps growing faster than sales.

One caution on the headline: Amazon carried its nonvoting preferred-stock investments, mostly Anthropic, at $122.3 billion at June 30. Any new mark, up or down, will move net income and EPS again, so operating income and the segment figures are the better guide to the quarter.

We will publish our analysis after Amazon files its results. Until then, the Q2 2026 report has the full figures behind this note.