On Friday, Amazon.com Inc (AMZN) opened sharply lower, dropping roughly 5% in early trading and falling more than 18% from its August peak, with a market capitalization of 2.52 trillion dollars.
The decline followed the release of the company's third-quarter results for the period ending September 30, 2026. Net sales rose 12% year over year to 201.94 billion dollars, slightly below the roughly 202.26 billion dollars analysts had expected. Diluted earnings per share fell about 3.1% year over year to 1.89 dollars, while analysts had forecast a modest 0.5% increase to 1.96 dollars. Operating income, however, jumped 61.5% year over year to 28.08 billion dollars, beating market expectations by more than 7%, and the operating margin climbed to 13.9%, the highest level in company history.
The quarterly report presented a clearly mixed picture: core operating profit came in stronger than expected and the closely watched cloud computing unit AWS maintained rapid growth, but growth in the core e-commerce business was lackluster, total revenue and earnings per share both fell short of Wall Street estimates.
Meanwhile, AI-related capital expenditures remained at elevated levels, intensifying market concerns about free cash flow and the timeline for returns on investment.
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