Amazon posts strong Q1 2026 with 16.6% sales growth, AWS leads with 28% rise, but stock downgraded to buy.

Amazon.com reported strong Q1 2026 results with net sales rising 16.6% year-over-year to $181.52 billion and an improved operating margin of 13.1%. The growth was mainly driven by Amazon Web Services (AWS), which grew 28%—its highest in four years—while e-commerce and advertising also performed well. Despite heavy capital expenditures exceeding $40 billion in Q1 and plans for $200 billion this year, Amazon maintains a resilient business model and strong liquidity with $87 billion in cash. The stock rating was downgraded from strong buy to buy due to short-term profit-taking risks, but the long-term outlook remains positive given Amazon's innovation, ecosystem, and attractive valuation.