AWS and Azure both posted record quarters but are growing in different ways. AWS revenue reached $45.98 billion, up 39%, its sixth straight quarter of faster growth, with a 38.7% operating margin. Azure grew 48%, daily Copilot users rose over 5x, and CFO Amy Hood forecast 49% to 50% constant-currency Azure growth next quarter. Amazon designs its own Trainium chips and plans to sell them outside AWS in late 2027, while Microsoft Cloud gross margin slipped to 66%. Microsoft generated $18.6 billion of free cash flow, while Amazon's trailing free cash outflow reached $42.4 billion.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
cloud computingearningsAmazonMSFTartificial intelligence
Open a keyword to see other news on the same topic.
Related tickers and likely impact
AMZN
• NeutralAmazon
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Consumer Discretionary |
| Industry | Broadline Retail |
| Market cap | $2.6T |
| Close on 10/30/2026 | 240.47 |
| Change that session | -1.36% |
MSFT
▲ Likely positiveMicrosoft
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Information Technology |
| Industry | Systems Software |
| Market cap | $3.9T |
| Close on 10/30/2026 | 521.90 |
| Change that session | -1.55% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- 5 Most Profitable Stocks of the Past 5 Years
The article ranks the five most profitable US-listed stocks of the past five years by cumulative net income, using Yahoo Finance data, and notes their popularity among analysts and hedge funds per Insider Monkey's Q2 2026 database. AI is driving demand for chips, memory and cloud computing. Reuters reported that second-quarter 2026 S&P 500 earnings were on track to rise 52% year over year, with technology up 74%, versus 33% when investment-related gains were excluded. For Amazon, AWS generated $16.6 billion of the company's $27.5 billion operating income in Q2 2026, with segment sales up 37% to $42.2 billion and a contracted backlog of $496 billion. However, its reported net income included $53.4 billion of non-operating pretax income mainly tied to its Anthropic investment, and trailing 12-month free cash flow was negative $7.6 billion versus $18.2 billion a year earlier.
- Prediction: Amazon Could Double by 2030 if This Part of Its Business Delivers
AWS revenue reached $42.23 billion in Q2 FY26, up 37% year over year and its fastest growth in 18 quarters, yet Amazon shares at $262.59 sit below their 52-week high of $287.20. Amazon raised its 2026 capex estimate to roughly $220 billion from about $200 billion, citing higher memory costs, and free cash flow was -$7.6 billion on a trailing basis. The article's five-year base case puts shares at $489.98 by October 2030, while the consensus target is $331.46. Reaching $500 would require a 90.4% gain, implying a forward P/E of 47x on consensus FY2027 EPS of $10.5519. The author calls the target ambitious but credible if AWS keeps growing above 30%, AI margins follow the core cloud path, and revenue outpaces capex; a recession hitting enterprise cloud budgets is the main risk.
- Should You Buy Jim Cramer and Ken Fisher's Top AI Stock Pick Ahead of Earnings?
Amazon (NASDAQ:AMZN) rose after Morgan Stanley named it a top pick and raised its price target to $350 from $335, ahead of its third-quarter report on October 29. The key question is whether AWS can grow fast enough to cover a spending plan that has pushed free cash flow below zero. AWS revenue rose 37% in the second quarter, above the 31% analysts expected, and its backlog is growing at triple-digit rates. Amazon raised its 2026 capital spending plan to about $220 billion from $200 billion, and trailing 12-month free cash flow turned negative from positive a year earlier. Second-quarter GAAP EPS of $5.75, versus an estimate near $1.83, was boosted by a large gain on Amazon's Anthropic stake, which can swing sharply in any quarter.
- What Could Surprise Microsoft Stock Investors On The Upside?
Microsoft stock lost 2.8% including dividends in the year to October 30, 2026, while the S&P 500 returned 11.3%, even though fiscal Q1 2027 revenue rose 18.8%. Commercial backlog grew 73% year on year to $677 billion, and management said customer demand continues to exceed available supply, though commercial bookings fell 12% after large Azure commitments in the prior year. Azure revenue grew 48% and Microsoft Cloud revenue reached $63.9 billion, up 30%, with about 30% of the backlog, roughly $203 billion, expected to be recognised within 12 months. Capacity constraints remain a risk, as some third-party capacity was delayed, capital spending reached $45.2 billion and free cash flow fell to $18.6 billion from $25.7 billion. The article says the next test is Azure growth in constant currency against management's 49% to 50% guidance for fiscal Q2 2027, to be reported in January 2027.
- 5 insightful analyst questions from Microsoft’s Q3 earnings call
Microsoft's third quarter beat Wall Street expectations, with revenue of $92.28 billion versus $90.64 billion expected (1.8% beat) and GAAP EPS of $4.92 versus $4.72 (4.3% beat). Management credited wide adoption of its cloud and AI offerings, particularly Copilot and Foundry, for rapid growth in enterprise demand, and CEO Satya Nadella said automated tasks have nearly doubled since July. Gross margin was 67.8%, down from 69% a year earlier, while operating margin of 49.8% was in line with the prior year; market capitalization stood at $3.94 trillion. The article also reviews five analyst questions from the call, covering long-term return drivers, Azure growth, enterprise versus digitally native AI workloads, operating margin sustainability, and usage-based billing outside coding.
- Microsoft, Google report booming AI revenue as the tech reshapes business
Microsoft and Google attributed cloud growth to strong demand for AI services, executives said on Wednesday's earnings calls. Alphabet's core search revenue grew just 12% from last year, weaker than expected, as AI reshapes the company. Microsoft reported 19% revenue growth in its Q1 2027 call, driven by Azure as it builds out data center infrastructure. Microsoft's capital expenditures were $45.2 billion, up about 30% from last year, while Alphabet's were $51.4 billion in the third quarter versus $24 billion a year ago, mostly for technical infrastructure supporting AI. Forrester analysts said both companies must prove AI is a meaningful commercial growth engine, not just an infrastructure investment cycle.
Related markets
Latest news
- Strategy Resumes Bitcoin Buys With $66M Purchase
Strategy bought 811 BTC for $65.5 million between October 26 and November 1, resuming purchases after a one-week pause, according to an SEC filing. It also spent $208.2 million from its USD Cash balance to repurchase 2,092,035 STRC shares, cutting USD Cash to $132.7 million from $242.4 million a week earlier. The company now holds 849,327 BTC, acquired for $64.08 billion at an average of about $75,451 per coin. Mizuho kept its Outperform rating and $165 price target on MSTR, while analyst Dan Dolev flagged dilution concerns as Bitcoin per share fell 3.7% this year. Strategy also faces possible removal from MSCI's equity indexes, with the list of affected companies due on November 11.
- Apple has turned into Wall Street's hedge against the AI trade: Chart of the Day
Apple has moved against chip stocks, rising on 30 of the 46 days the Philadelphia Semiconductor Index fell 2% or more, a much higher share than in past years. Its correlation with the chip index turned negative in July and hit a record low in September. Over the past four reported quarters, Amazon, Alphabet, Microsoft and Meta spent more than $600 billion on capital expenditures, while Apple spent about $10 billion. Apple still faces pressure from higher memory chip costs, which Bank of America says will weigh on iPhone margins, and the bank considers Wall Street's margin forecasts too high into next year.
- Inuvo's IntentKey Puts Custom Audiences Live on Safari and iPhone Within 24 Hours
Inuvo (NYSE American: INUV) says its managed IntentKey service can put custom audiences live on Safari and iPhone within 24 hours of an approved campaign plan. Since Apple's iOS 27 update further limited how advertisers recognize people in Safari, the company says IntentKey has kept the same share of iPhone impressions with no change in client performance. Unlike cookie-based approaches, IntentKey uses a large language model to read content across the open web and infer interest and intent, with no cookies or personal data attached to profiles. Roughly a third of its iPhone traffic now runs on iOS 27, and Inuvo notes it first offered Safari reach without cookies in 2022 and again in 2023 when Apple tightened tracking in iOS 17.
- Gold Has Cooled From Its First-Quarter Record, Yet Miners Still Sold Ounces at Prices More Than 20% Above Last Year
Gold's third-quarter average was $4,262 an ounce, about 23% above the same quarter of 2025, but it has fallen for two straight quarters from a first-quarter record of $4,872.90. The LBMA Gold Price PM was $3,913.25 on October 30. The World Gold Council linked September's decline to rising Treasury yields and the U.S. dollar after the Fed's rate increase, though the 10-year yield has since eased from 5.29% to 4.94%. Buying has held up, with gold-backed ETFs taking in a record $31 billion in the third quarter and central banks buying 289 tonnes in the second quarter. Four gold miners reported realized prices more than 20% above a year earlier.
- Buy, Sell, or Hold? Today's Top Upgrades and Downgrades: Amazon.com, Coinbase Global, CrowdStrike, FormFactor, GameStop, L3Harris Technologies, Oracle, Reddit, Rivian Automotive, and More
Wall Street analysts made several rating changes on Monday, November 2, 2026, after the Nasdaq fell 5.2% in October. Upgrades include Amazon.com to Buy from Accumulate at Phillip Securities, with its target raised to $330 from $320, and CrowdStrike to Buy from Hold at Deutsche Bank, with its target lifted to $300 from $240. Morgan Stanley downgraded Coinbase Global to Underweight from Equal Weight and cut its target to $120 from $258, while Loop Capital cut Reddit to Hold from Buy with a target of $100 from $250. Among initiations and resumptions, TD Cowen started AngloGold Ashanti at Buy with a $123 target, and Morgan Stanley resumed L3Harris Technologies at Overweight with a $402 target.
- SuperMatics Is Building AI to Find the Next Superconductors for Commercial Wire
SuperMatics, a Berkeley company building AI exclusively for superconductors, argues that the gap lies not in discovering materials but in making tough, affordable wire. It points to rising demand from AI data centers and fusion developers, which rely on costly, scarce high-temperature superconducting tape. Its models, built on physics including the Modulated Electron Lattice (MEL) framework, predict properties, write synthesis recipes and simulate finished wire, and every result, failures included, retrains them. The company works with researchers at UC Berkeley and Georgia Tech and is in talks with materials and technology firms on joint programs. It will present at the Plug and Play Silicon Valley November Summit on November 5.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.