"When the company reported Q3 earnings on Oct. 30, it beat on the top and bottom lines, with EPS of $1.95 vs. an estimated $15.7, and revenue of $180.17 vs. $177.80 estimated. Meanwhile, revenue from Amazon Web Services was $33 billion and revenue from advertising was $17.7 billion. Concerns about the company's enormous AI CapEx remain, but after the Q3 earnings call, the stock was rewarded by bullish investor sentiment, hitting its first record high since February 2025."
"In October, leaked documents revealed that the company is aiming to replace around 600,000 Amazon jobs with robots, with the management team estimating that the effort could trim 30 cents off each item purchased via the e-commerce giant by 2027. In July, the company deployed its 1 millionth robot while also deploying its new AI foundation model to power its robotic fleet."
"Emerging business segments add to that optimism. Amazon's recently announced plan to launch a proprietary AI model with advanced reasoning capabilities is set to compete with OpenAI's ChatGPT. Scheduled for a June launch date, the model - named Nova - is intended to provide a price-efficient option over its competitors, including ChatGPT, Anthropic's Claude 3.7 Sonnet and Google's Gemini 2.0 Flash Thinking."
Shares declined recently, leaving Amazon with a modest 1.06% year-to-date gain and a 4.45% decline over the past year after a post-November sell-off. Q3 results beat estimates with EPS of $1.95 and revenue of $180.17 billion, while AWS generated $33 billion and advertising $17.7 billion. Large AI capital expenditure concerns persist despite bullish investor sentiment after the earnings call. Leaked plans aim to replace roughly 600,000 jobs with robots, projecting a 30-cent per-item cost reduction by 2027, and the company deployed its 1 millionth robot. AWS and emerging segments support expectations of surpassing $100 billion in operating income within two years, while a June launch of the Nova AI model targets price-efficient competition with ChatGPT and other advanced models.
Read at 24/7 Wall St.
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