Key Highlights

  • Amazon (NASDAQ:AMZN) was indicated about 6.6% to 7.1% lower in Friday premarket, near USD 226, after Q3 EPS of USD 1.89 missed the USD 1.96 estimate.
  • AWS grew 39% to USD 46.0 billion with Operating Income of USD 17.8 billion, while total net sales came in at USD 201.9 billion for the quarter.
  • Q3 capex was USD 77.3 billion versus USD 35.1 billion a year earlier, and trailing free Cash Flow was an outflow of USD 42.4 billion against a USD 14.8 billion inflow.
  • Management pointed to 2026 capex of about USD 220 billion and a Q4 sales guide of USD 240 billion to USD 247 billion versus about USD 244.2 billion expected.

The Quarter in Numbers

Amazon (NASDAQ:AMZN) released Q3 results after the close on October 29, 2026. Net sales were USD 201.9 billion, and AWS grew 39% to USD 46.0 billion, with AWS operating income of USD 17.8 billion. EPS of USD 1.89 missed the USD 1.96 estimate. Net Income of USD 20.7 billion fell year over year because the year-ago quarter included USD 9.5 billion of gains tied to Anthropic, per the company release. That base effect explains part of the EPS shortfall without any single operating failure. The stock had already dropped 4.25% in Thursday's regular session before the report, so the premarket move adds to an existing slide.

Capex, Free Cash Flow and the Q4 Guide

The sharper concern is the cost of growth. Q3 capex reached USD 77.3 billion, more than double the USD 35.1 billion of a year earlier, and 2026 capex is guided to about USD 220 billion. Heavy spending on data centers and chips lifts Depreciation later and absorbs cash now, which is why trailing free cash flow turned to an outflow of USD 42.4 billion from a USD 14.8 billion inflow. The Q4 sales guide of USD 240 billion to USD 247 billion brackets the roughly USD 244.2 billion expected, so the outlook is not weak on revenue. The debate is whether returns on the spending arrive fast enough.

Risks and What to Watch

Premarket quotes ranged from 6.6% to 7.1% lower, and the figure can move at the 9:30 a.m. ET open. Some commentary calls this a first miss, but that framing is unverified, so we do not rely on it. Alphabet closed 12.7% lower on Thursday after its own results, and Nasdaq-100 futures were down about 2.5%, so sector sentiment is fragile. Investors comparing mega-cap exposure through Invesco QQQ Trust (NASDAQ:QQQ) may note how many index members are raising spending at once. Key risks are rising depreciation, a long payback on capex and slower cloud growth if capacity comes online late. Later filings and analyst notes will show whether the market keeps rewarding growth that consumes this much cash.

Where Things Stand

Amazon (NASDAQ:AMZN) slid about 7% in premarket because a small EPS miss met a very large spending plan and a free cash flow outflow of USD 42.4 billion. AWS growth of 39% and a Q4 sales guide near expectations did not offset those worries. The move is a premarket snapshot and may change at the open. The next catalysts are the regular session, analyst target changes, which we could not find yet, and further capex commentary. This is not Investment advice.