Amazon Q2 Earnings to Spotlight AWS Growth Amid AI Spending: How Markets React?

Amazon (AMZN) is set to report Q2 earnings, highlighting AWS growth and AI investments following Alphabet's (GOOG, GOOGL) underwhelming results. Alphabet's increased AI spending to $195 billion-$205 billion, up from $180 billion-$190 billion, sent its shares down by 6%. Amazon, meanwhile, plans to invest over $200 billion in 2026, with AWS projected to generate $40.5 billion in Q2, a 31% increase from Q2 2025.

■AWS's AI positioning, Bedrock data points, and Trainium benefits are key metrics for investors.

■Amazon's RPOs (Remaining Performance Obligations) stand at $364 billion, while e-commerce and advertising revenue are expected to grow by 13% and 23%, respectively.

■CEO Andy Jassy's push for chip sales for customers' data centers could boost margins. Markets may turn more favorable if Amazon demonstrates the profitability of these investments.

Alphabet's AI spending surge has driven markets into risk-off mode, while Amazon's focus on AWS growth could reverse this trend. AWS's AI positioning and Trainium benefits remain critical support for investors.