Executive Summary

• Amazon reported 2Q16 revenues of $30.4 billion, up 31.1% year over year, beating the $29.6 billion consensus estimate and at the high end of the guidance range of $28–$30.5 billion. EPS was $1.78, compared to $0.19 in the year-ago quarter and consensus of $1.11.
• Amazon Web Services (AWS) was the fastest-growing segment in the quarter, with revenues growing 58.2% to $2.9 billion. Electronics and general merchandise was the largest revenue contributor, with revenues up 33.8% year over year to $22.0 billion.
• For 3Q16, the company guided for revenues of $31.0–$33.5 billion, up 22%–32% year over year, compared to consensus of $31.7 billion. Amazon also guided for operating income of $50–$650 million, below the consensus estimate of $830 million.