Amazon Q1 Results Boost Stock Outlook Amid AWS Growth and Senate Probe

Amazon reported first‑quarter FY26 revenue of $181.52 billion, up 16.6% year‑over‑year, and earnings per share of $2.78, well above analysts' expectations. Its cloud unit, Amazon Web Services, grew 28%, the fastest expansion in 15 quarters, and the advertising business now exceeds $70 billion in annual revenue. CEO Andy Jassy said the company is "in the middle of some of the biggest inflections of our lifetime, we’re well positioned to lead."

Analysts have raised the price target for the stock to around $307, implying roughly 30% upside, while a proprietary model projects a 32% increase over the next year. However, the company faces a Senate Small Business Committee investigation into alleged Chinese‑linked bribery affecting third‑party sellers, prompting a brief share dip. The probe cites "compelling evidence" of sellers receiving favorable treatment for payments.

Despite regulatory scrutiny, Amazon’s guidance projects second‑quarter revenue of $194‑199 billion and operating income of $20‑24 billion. Capital spending remains high, with free cash flow down 95% to $1.2 billion and debt rising to $119.1 billion.