Amazon CEO Andy Jassy speaks during an Amazon Devices launch event in New York City, U.S., February 26, 2025.
Amazon shares soared 12% on Friday after the company reported an across-the-board beat for the third quarter and boosted its forecast for spending due to demand for artificial intelligence services.
Cloud was a major driver of revenue and profit growth, with sales at Amazon Web Services climbing 20% from a year earlier to $33 billion, topping expectations.
The unit generated operating income of $11.4 billion, accounting for roughly two-thirds of Amazon's total operating profit.
Revenue in the digital advertising business, another growth engine, jumped 24% to $17.7 billion. Total sales at Amazon climbed 13% to $180.17 billion, topping the average analyst estimate of $177.8 billion, according to LSEG. Earnings per share came in at $1.95, exceeding the $1.57 average estimate.
"Amazon has a deep moat around their core businesses driven by their unmatched scale," analysts at Pivotal Research wrote in a note after the report.
The analysts, who recommend buying the stock, said Amazon "appears to have numerous healthy organic growth opportunities driven by their high margin AWS cloud segment" and areas like advertising.
Coming into earnings, cloud was an area of key concern due to increased competition from Google and Microsoft, which also reported quarterly results this week. Google's cloud revenue increased 34% during the third quarter, while Microsoft Azure recorded growth of 40%.