Amazon also runs a shop, which is quickly learning commerce in India
Amazon’s Q3 2026 (Jul–Sep) sales rose 12% to $201.9 billion and operating income 61% to a record $28.1 billion. AWS, at 23% of revenue, earned 63% of the profit and grew 39%, its fastest in nearly five years. Retail margins are improving too, but slowly: the international segment, which includes India, earned a 3.7% margin. Its quick-commerce service, Amazon Now, expanded to more than 450 towns and cities, with orders up tenfold, putting Amazon squarely in the race Eternal and Swiggy have been running in India.
Key takeaways
- AWS revenue $46.0 billion (+39.3%), at a $184 billion annual run rate; AWS operating margin 38.7%.
- Management expects AWS to grow more than 40% in both 2027 and 2028, and 2026 capex of about $220 billion.
- International operating income rose 32% to $1.6 billion on $43.1 billion of sales.
- Alexa+ expanded to India this quarter.
The quarter in brief
Source: Amazon Q3 2026 results release, 29 Oct 2026. Net income fell because the year-ago quarter included a $9.5 billion pre-tax gain on Amazon’s investment in Anthropic.
AWS pays for everything
AI demand has turned AWS from a steady growth business back into a fast-growing one, and its margin is now nearly 39%. That profit funds Amazon’s roughly $220 billion of capex this year, most of it on AI data centres, and lets the retail business invest in faster delivery without hurting group margins. The same AI build-out is what is pushing up memory and chip prices, as SK hynix and TSMC showed this season.
Amazon Now: the India test
Amazon Now, its ultra-fast delivery service, started in India and has now expanded to more than 450 towns and cities, with orders up tenfold year on year. Earlier this year Andy Jassy said Prime members in India triple their shopping frequency once they start using it. In India’s quick-commerce market, led by Eternal’s Blinkit, Swiggy Instamart and Zepto, Amazon is now a serious competitor with deep pockets, funded by cloud profits.
International: profitable, barely
The international segment grew sales 5% and earned a 3.7% operating margin. India is part of that segment and Amazon does not report it separately. A thin margin while investing in quick commerce suggests India remains an investment market, not a profit centre.
Implications
Techarc view
Amazon’s quarter shows how AI is reshaping even retail: cloud profits now fund the retail business’s next bets. In India, the bet is quick commerce, where Amazon arrived late but with the advantage of being able to lose money longer than anyone else. The pairing to watch is Amazon Now’s growth against Eternal’s and Swiggy’s margins over the next few quarters.
What to watch
- Any India-specific disclosure on Amazon Now cities, dark stores or order volumes.
- International segment margin in the festive quarter.
- AWS India investments and data-centre capacity announcements.
Sources
Company filings
- Amazon Q3 2026 results release (29 Oct 2026)
Supporting coverage
