20260803-招银国际-Solid_AWS_revenue_growth_and_margin_expansion_7页_1mb

Amazon (AMZN US) Summary

Core Financial Performance

Amazon reported its 2Q26 results on 31 July (BJT), showcasing strong revenue growth and margin expansion. Key highlights include:

• Revenue: US$200.6bn, representing a 19.6% YoY increase, surpassing both the forecast and Visible Alpha (VA) consensus by 2%.
• Operating Profit (OP): Rose 43% YoY to US$27.5bn, exceeding the consensus of US$23.7bn.
• AWS Revenue: Grew 37% YoY to US$42.2bn, 4% ahead of consensus, with operating margin (OPM) of 39.4%, up 6.5ppts YoY.

Segment Analysis

North America

• Revenue: US$116.2bn, up 16.1% YoY, 2% ahead of consensus.
• OPM: Increased to 7.9%, up 0.4ppts YoY.
• Operating Profit: US$9.1bn, up 6.6% YoY.

International

• Revenue: US$42.2bn, up 14.8% YoY, with OPM of 4.1%, flat YoY.
• Operating Profit: US$1.7bn, up -3.7% YoY.

AWS

• Revenue: US$42.2bn, up 37% YoY, 4% ahead of consensus.
• OPM: 39.4%, up 6.5ppts YoY.
• Operating Profit: US$16.6bn, up 21.5% YoY.
• Capex: US$53.1bn, up 69% YoY and 23% QoQ.
• AWS Backlog: Reached US$496bn, up 36% QoQ, indicating continued demand.

AI and Silicon Initiatives

• Amazon's Chip Business: Combined annual revenue run-rate of over US$25bn, up from US$20bn in 1Q26, showing triple-digit YoY growth.
• AWS AI Business: Annual revenue run-rate exceeded US$25bn, also growing at a triple-digit YoY rate.

Forecast and Valuation

• 2026-2028E Revenue Forecasts: Remain largely unchanged.
• Operating Profit Forecast: Raised by 7-10% to reflect stronger AWS margin expansion.
• Target Price: Updated to US$301 from US$305, based on 17.2x EV/EBITDA, aligning with the three-year average trading range.
• Valuation Metrics:
  • P/E Ratio: 21.2x (FY26E).
  • P/B Ratio: 4.9x (FY26E).
  • EV/EBITDA: 17.2x (FY26E).

Financial Highlights (2023A to 2028E)

Shareholding and Performance

• Market Cap: US$2,988,471.1mn.
• Shareholding Structure:
  • Jeffrey P. Bezos: 8.2%.
  • The Vanguard Group, Inc.: 8.0%.
• Share Performance:
  • 1-month: +13.9% (Absolute), +17.7% (Relative).
  • 3-month: +2.5% (Absolute), +0.5% (Relative).
  • 6-month: +13.5% (Absolute), +4.9% (Relative).

Analyst Ratings and Outlook

• CMBIGM Rating: BUY.
• Reason: Stronger-than-expected AWS margin expansion and continued demand support.
• Target Price: US$301.00, down from US$305.00, reflecting updated valuation assumptions.
• Current Price: US$271.58.
• Up/Downside: 10.8%.

Summary of Key Financial Metrics

• Revenue Growth: Expected to continue at 16% YoY in 2026, with a 13.2% YoY in 2028.
• Net Profit Growth: Projected to increase significantly, with 77.6% YoY growth in FY26E.
• EPS (Reported): US$12.82 (FY26E), up from US$7.28 (FY24A).
• P/E Ratio: Drops from 48.4x (FY24A) to 21.2x (FY26E), indicating improved profitability.

Risk and Disclaimer

• This report is not tailored to individual investors and should not be relied upon for investment decisions.
• CMBIGM is not a registered broker-dealer in the U.S. or Singapore.
• The information is based on publicly available data and may be subject to change.
• The report is for the use of intended recipients only and may not be reproduced or distributed without prior consent.