Abstract
Amazon will release first-quarter 2026 results after hours on April 29, 2026, and this preview distills consensus expectations, segment dynamics, and the key debates shaping near-term earnings and guidance.
Market Forecast
Consensus expects Amazon to post revenue of 177.26 billion US dollars for the March quarter, up 14.33% year over year, with adjusted EPS of 1.63, up 19.81% year over year; EBIT is projected at 20.93 billion US dollars, up 19.72% year over year. Mainline commerce and retail services are expected to benefit from operational efficiency and higher third-party activity, while the advertising business continues to expand its role in the profit mix; AWS remains the central swing factor for both growth and margins this quarter. AWS is the most promising segment heading into the print: the unit generated 35.58 billion US dollars last quarter and is positioned for continued double-digit expansion on secular demand for AI infrastructure.
Last Quarter Review
Amazon reported fourth-quarter 2025 revenue of 213.39 billion US dollars, a gross profit margin of 48.47%, GAAP net profit attributable to shareholders of 21.19 billion US dollars, a net profit margin of 9.93%, and adjusted EPS of 1.95, up 4.84% year over year. A notable financial highlight was EBIT of 24.98 billion US dollars, up 17.80% year over year, with revenue exceeding consensus by 2.05 billion US dollars. From a business-mix perspective, the quarter’s revenue composition was led by Online stores at 82.99 billion US dollars, Third-party seller services at 52.82 billion US dollars, AWS at 35.58 billion US dollars, Advertising services at 21.32 billion US dollars, Subscription services at 13.12 billion US dollars, Physical stores at 5.86 billion US dollars, and Other at 1.71 billion US dollars, collectively supporting 13.63% year-over-year top-line growth.
Current Quarter Outlook
Core Commerce and Retail Services
Consensus assumes the retail complex will deliver healthy double-digit growth, with the balance of contributions shifting toward higher-margin third-party seller services and advertising tied to the retail media platform. The fulfillment and logistics footprint continues to compound efficiency gains made over the past year, which should help contain unit-level costs through the post-holiday normalization period in the March quarter. In addition, the blend of first-party and third-party volume matters for gross margin and operating leverage; a richer mix of third-party services typically supports profitability because fees and ancillary services carry structurally higher margins than first-party product sales. Customer engagement through Prime offerings remains a backbone for conversion and frequency, and incremental features in health, pharmacy, and media can reinforce the ecosystem and increase lifetime value. Management’s discipline around expense control, coupled with automation in sort centers and delivery routes, can further protect margin as volume steps down seasonally from holiday levels while maintaining a path toward year-over-year expansion in operating income.
AWS and Generative AI
AWS is the pivotal driver for both sentiment and valuation into this report, and it remains the primary candidate for upside to consensus if deal activity and workloads tied to generative AI translate into recognized revenue at a faster clip. The unit’s last-quarter revenue base of 35.58 billion US dollars underscores the scale from which even small percentage accelerations can yield substantial absolute-dollar contributions to operating profit. Recent developments around expanding AI model partnerships and customer deployments point to sustained demand for training and inference capacity, supporting a multi-quarter cycle of higher compute intensity and capacity additions. The broader AI stack—spanning homegrown silicon, networking, and software services—creates a pathway to both performance gains and potential cost efficiencies, though depreciation and amortization from new capacity will remain a headwind to near-term operating margins. The pace of large-language-model adoption and the timing of project ramps across enterprise customers will be crucial for determining whether AWS margin trends can expand alongside growth or instead stay flattish while the platform absorbs elevated capital intensity.
Stock-price Drivers This Quarter
Three factors are most likely to move the stock around this print: the trajectory of AWS growth and margins, the magnitude and mix of retail and advertising profitability, and the tone of management’s guidance for the June quarter. An upside surprise from AWS—via higher-than-modeled usage, faster realization of AI contracts, or better unit economics—would have an outsized impact on earnings power given AWS’s leverage on consolidated operating income. On the retail side, a stronger mix of third-party services and ad monetization can offset seasonal normalization in first-party volume, with improvements in routing, automation, and inventory turns helping gross margin resilience; any evidence that these efficiencies are sustainable will support a higher-quality earnings profile. Finally, even with consensus modeling revenue growth of 14.33% year over year for the March quarter, the market will quickly look through to forward period commentary; clarity around capital allocation, capacity additions for AI-related infrastructure, and visibility into consumer demand elasticity will shape multiple and estimate revisions.
Analyst Opinions
The recent sell-side stance on Amazon is predominantly bullish, with a 100% bullish ratio across the opinions identified over the period reviewed. Several well-followed analysts emphasize upside risk to consensus driven by AWS’s AI-related demand and the profitability lift from advertising and third-party seller services: one reiterated-Buy view highlights “accelerating AWS, AI, and advertising growth” as the key catalysts for outperformance versus current models. Another Buy reiteration underscores the case for sustained re-rating as AWS growth improves and monetization strengthens across the retail media stack, while a separate Buy call points to balanced strength across e-commerce, cloud, and advertising as near-term supports for revenue and operating income. A noted Buy reiteration frames the path to mid-teens revenue growth with the potential for margin expansion as the mix shifts toward higher-margin businesses and logistics productivity continues to improve. Complementing these direct ratings, a recently discussed expansion of Amazon’s partnership activity around AI models has been cited by market strategists as a tailwind for cloud-related hardware and networking demand across the supply chain, reinforcing the thesis that AWS remains early in a multi-year capacity and monetization cycle. Together, these viewpoints converge on a common narrative: consensus is seen as reasonable to beat on revenue and EPS if AWS growth reaccelerates and advertising continues to scale, with the greatest sensitivity residing in management’s commentary on AI-driven workloads, capacity readiness, and the cadence of customer ramps through the remainder of 2026.
