Amazon Earnings: Q1 Revenue Hits $155.7B as AWS Surges 17%

Rhea-AI Summary

Amazon (AMZN) reported strong Q1 2025 financial results with net sales increasing 9% to $155.7 billion. The company's operating income rose to $18.4 billion, while net income reached $17.1 billion ($1.59 per share), up from $10.4 billion in Q1 2024. AWS segment showed robust growth with sales up 17% to $29.3 billion. Regional performance included North America sales growth of 8% to $92.9 billion and International sales growth of 5% to $33.5 billion. Operating cash flow increased 15% to $113.9 billion for the trailing twelve months. The company launched several innovations including Alexa+, expanded Project Kuiper satellite deployment, and introduced new AWS capabilities. For Q2 2025, Amazon expects net sales between $159.0-164.0 billion, representing 7-11% growth.

Positive

• Net sales increased 9% YoY to $155.7 billion
• Operating income grew to $18.4 billion from $15.3 billion YoY
• Net income surged to $17.1 billion ($1.59 per share) from $10.4 billion YoY
• AWS segment showed strong 17% growth with $29.3 billion in sales
• Operating cash flow increased 15% to $113.9 billion
• $4 billion investment planned for rural delivery network expansion
• Successful launch of Project Kuiper satellites for broadband expansion

Negative

• Free cash flow decreased to $25.9 billion from $50.1 billion YoY
• Foreign exchange rates had $1.4 billion unfavorable impact on net sales
• Q2 2025 operating income guidance suggests potential decline compared to Q2 2024

Insights

Financial Analyst

Amazon reports outstanding Q1 results with 64% net income growth and strong performance across all segments, particularly AWS's 17% growth.

Amazon has delivered exceptional Q1 2025 results with growth accelerating across all business segments. Net sales increased 9% year-over-year to $155.7 billion, or 10% excluding foreign exchange impacts. Breaking down by segment: North America grew 8% to $92.9 billion, International rose 5% to $33.5 billion (8% in constant currency), and most impressively, AWS surged 17% to $29.3 billion.

The profitability metrics reveal even more striking improvements. Operating income jumped 20% to $18.4 billion, with AWS contributing $11.5 billion (up 22% YoY). Net income soared 64% to $17.1 billion, translating to earnings per share of $1.59 - a 62% increase from Q1 2024's $0.98.

Amazon's cash flow patterns show interesting dynamics. Trailing twelve-month operating cash flow increased 15% to $113.9 billion, while free cash flow decreased to $25.9 billion from $50.1 billion in the comparable period. This divergence reflects substantial infrastructure investments, including a $4 billion commitment to expand rural delivery through 2026 and Project Kuiper satellite deployment.

For Q2 2025, Amazon projects net sales between $159.0-$164.0 billion (7-11% growth) and operating income between $13.0-$17.5 billion. The midpoint of this operating income guidance would represent sequential deceleration from Q1, likely reflecting increased investment spending.

The company's aggressive AI expansion across its ecosystem - including Alexa+, Amazon Nova models, and new AWS offerings - underscores its strategic focus on maintaining technological leadership while delivering immediate financial benefits. AWS continues to be the profit engine with a 39.2% operating margin, while retail operations also showed improved profitability.

Technology Analyst

AWS drives Amazon's growth with 17% revenue surge and expanding margin, while AI investments position company for continued technological leadership.

Amazon's Q1 results highlight how AWS has become the company's growth powerhouse, with 17% year-over-year revenue growth to $29.3 billion and operating income surging 22% to $11.5 billion. This translates to an impressive 39.2% operating margin - far outpacing the company's overall margin and demonstrating cloud computing's exceptional economics.

The report reveals Amazon's strategic AI investment trajectory across its ecosystem. The launch of Alexa+ represents a significant upgrade to the company's voice assistant capabilities, now providing enhanced intelligence and action-taking abilities bundled with Prime membership. Meanwhile, Amazon Nova's rapid customer acquisition (including Slack, Siemens, Coinbase) signals strong enterprise demand for Amazon's AI solutions.

AWS continues expanding its AI infrastructure with new foundation models in Amazon Bedrock, including integrations with leading models from Anthropic (Claude 3.7 Sonnet), Meta (Llama 4), and Mistral AI (Pixtral Large). The company is clearly positioning itself as an AI enablement platform rather than just focusing on proprietary models.

The introduction of Amazon Nova Sonic for speech-to-speech applications, Nova Act SDK for web browser automation, and Nova Premier for complex tasks demonstrates Amazon's comprehensive approach to solving practical AI challenges across modalities. By expanding model availability to Europe and Asia Pacific, Amazon is accelerating global AI adoption.

Project Kuiper's satellite deployment represents Amazon's bold move into space-based internet infrastructure, potentially opening new revenue streams while addressing rural connectivity challenges. Combined with the $4 billion investment in rural delivery network expansion, Amazon is systematically removing geographical barriers to its services.

These technology investments, while impacting free cash flow in the short term ($25.9 billion vs. $50.1 billion previous year), position Amazon to maintain its technological leadership across cloud, AI, logistics, and content delivery - creating multiple growth vectors beyond its core retail operations.

Amazon Reports 9% Revenue Growth and 64% Surge in Net Income for Q1 2025

Amazon.com, Inc. (NASDAQ: AMZN) reported first-quarter 2025 financial results on May 1, showcasing robust growth across all business segments with net sales reaching $155.7 billion, a 9% increase from the same period last year. The e-commerce and cloud computing giant also posted a significant 64% jump in net income to $17.1 billion, or $1.59 per diluted share, according to the company's earnings release.

Excluding the $1.4 billion unfavorable impact from year-over-year changes in foreign exchange rates, Amazon's net sales would have increased by 10% compared to the first quarter of 2024.

Segment Performance

Amazon's performance showed growth across all major business segments:

• North America segment sales rose 8% year-over-year to $92.9 billion, with operating income increasing to $5.8 billion from $5.0 billion in Q1 2024
• International segment generated $33.5 billion in sales, up 5% (or 8% excluding foreign exchange impacts), with operating income of $1.0 billion compared to $0.9 billion in the previous year
• AWS (Amazon Web Services) continued its strong performance with sales of $29.3 billion, a 17% year-over-year increase, while operating income jumped to $11.5 billion from $9.4 billion

The company's overall operating income increased to $18.4 billion in the first quarter, compared with $15.3 billion in the first quarter of 2024, representing a 20.3% improvement.

Cash Flow and Financial Health

For the trailing twelve months, Amazon reported operating cash flow of $113.9 billion, a 15% increase compared to the $99.1 billion for the period ended March 31, 2024. However, free cash flow—an important metric that reflects cash generated after accounting for capital expenditures—decreased to $25.9 billion for the trailing twelve months, down from $50.1 billion in the comparable prior period.

"We're pleased with the start to 2025, especially our pace of innovation and progress in continuing to improve customer experiences," said Andy Jassy, President and CEO of Amazon, in the release. Jassy highlighted several innovations including the launch of Alexa+, faster delivery for Prime members, new Trainium2 chips, and the successful launch of the company's first Project Kuiper satellites aimed at providing broadband access to underserved rural areas.

Product and Service Innovations

During the quarter, Amazon introduced several new products and services that highlight the company's continued focus on innovation. The company launched Alexa+, described as a "next-generation Alexa personal assistant" with enhanced capabilities and intelligence that is available free with Prime membership.

The company also expanded its retail offerings with new luxury partnerships, including the introduction of Saks on Amazon, featuring high-end brands like Dolce&Gabbana, Balmain, and Fear of God. Additionally, Amazon launched a new "Interests" feature that utilizes generative AI to help customers discover products related to their hobbies and passions.

In a significant infrastructure development, Amazon began the full-scale deployment of its Project Kuiper satellite internet network with the launch and activation of its first satellites, marking a major milestone in the company's ambition to provide global broadband coverage.

AWS Growth and Expansion

AWS continued to be a major growth driver for Amazon, with the company announcing new agreements with major enterprises including Adobe, Uber, Nasdaq, Ericsson, Fujitsu, and Cisco. The cloud division also introduced several new offerings, including expanded foundation models in Amazon Bedrock such as Anthropic's Claude 3.7 Sonnet and Meta's Llama 4 family of models.

Amazon Nova, the company's AI platform, saw rapid customer adoption with companies like Slack, Siemens, Coinbase, and FanDuel beginning to use the service. The company also announced several new Nova capabilities, including Amazon Nova Sonic for speech-to-speech applications and Amazon Nova Premier for complex tasks like coding and document understanding.

Forward Guidance

Looking ahead to the second quarter of 2025, Amazon provided the following guidance:

• Net sales are expected to be between $159.0 billion and $164.0 billion, representing growth of 7% to 11% compared to Q2 2024
• Operating income is projected to be between $13.0 billion and $17.5 billion, compared with $14.7 billion in the second quarter of 2024

The company noted that its guidance assumes no additional business acquisitions, restructurings, or legal settlements will be concluded during the period.

Amazon also announced that its 11th Prime Day will take place in July, when customers can expect millions of deals globally across its vast selection of products. Additionally, the company revealed a $4 billion investment through 2026 to expand its rural delivery network, aiming to bring faster delivery to customers in less densely populated areas across the United States.

This article is based solely on information provided in Amazon.com, Inc.'s press release dated May 1, 2025. The content is for informational purposes only and does not constitute financial, investment, legal, or tax advice. Stock Titan and its writers make no representations as to the accuracy, completeness, or timeliness of the information. Investors should conduct their own due diligence before making any investment decisions.

Source: Amazon

FAQ

What were Amazon's (AMZN) Q1 2025 earnings per share?

Amazon reported earnings of $1.59 per diluted share in Q1 2025, compared to $0.98 per share in Q1 2024.

How much revenue did Amazon AWS generate in Q1 2025?

AWS generated $29.3 billion in revenue during Q1 2025, representing a 17% increase year-over-year.

What is Amazon's revenue guidance for Q2 2025?

Amazon expects Q2 2025 net sales between $159.0 billion and $164.0 billion, representing growth of 7-11% compared to Q2 2024.

How much did Amazon's operating income increase in Q1 2025?

Amazon's operating income increased to $18.4 billion in Q1 2025, up from $15.3 billion in Q1 2024.

What was Amazon's free cash flow in Q1 2025?

Amazon's free cash flow decreased to $25.9 billion for the trailing twelve months, compared to $50.1 billion in the same period last year.