Amazon misses estimates as AWS grows and cash flow turns negative

Amazon reported third-quarter revenue and earnings below analysts’ estimates as strong growth in its cloud business contrasted with slower retail sales and a sharp decline in trailing-year free cash flow. The company maintained its 2026 capital-spending forecast at about $220 billion, as it continues investing in artificial intelligence infrastructure. Net sales for the quarter ended September 30 were about $201.9 billion, up 12% from a year earlier. Earnings were $1.89 per share. Analysts had expected revenue of roughly $202.2 billion to $202.3 billion and earnings of about $1.96 to $1.97 per share, according to estimates cited in reports. Amazon shares fell more than 6% in extended trading, with some reports putting the decline above 9%. Amazon Web Services revenue rose 39% year over year to about $46 billion. The company described the increase as AWS’s fastest growth in nearly five years. AWS operating income rose to $17.8 billion from $11.4 billion a year earlier, according to the company’s results. Chief Executive Andy Jassy said Amazon expects AWS revenue growth above 40% in both 2027 and 2028. The retail business showed slower growth. Online store sales increased 2% to...