Amazon Rallies After Strong Quarter Despite Setbacks

Amazon reported a blowout third quarter with $180.2 billion in revenue and $1.95 adjusted EPS, beating estimates and sending shares to record highs (up roughly 11–12%). AWS grew about 20% year over year to roughly $33 billion, driven by strong AI infrastructure demand, rapid adoption of Trainium chips, and Project Rainier capacity plans. Management raised 2025 capital expenditures to $125 billion to support large-scale model training and expanded Trainium deployments. Analysts and investors called the results an "AWS unlock" or "AI narrative flip," and the rally helped lift major U.S. indexes. The quarter also included notable headwinds: operating income was flat after a $2.5 billion FTC settlement and $1.8 billion in severance, and the company announced about 14,000 layoffs. Despite the strong quarter and AI momentum, Amazon still trails Microsoft and Google in year-to-date stock performance.