Amazon’s Q2 Results: A Masterclass in Misdirection
7 August 2026
Paul Adams – Chief Growth Officer
Amazon crossed $200bn in a single quarter for the first time ($200.6bn, up 20%). Amazon’s cloud division grew 37% year over year, its fastest rate in 18 quarters. The headline was about AWS, Jassy barely mentioned retail. The numbers were strong, but the story underneath them is a company quietly rebuilding how shopping works and betting that advertisers pay for the privilege of being inside it.
The ads business has stopped being a side hustle
Advertising grew 26% to $19.8bn, its fastest clip in six quarters and roughly double Google’s pace (14%) It added $4.1bn year-on-year, more than any part of Amazon except AWS. What matters is not the rate but the mechanism. Amazon is no longer selling placements; it is selling automation. Ads Agent, its AI campaign builder, rolled into eleven more countries this year (now 36 markets across six continents), and Amazon claims advertisers using it see 8% lower cost per impression and 6% lower cost per acquisition than those who don’t. If that holds, the competitive moat shifts from who has the best trading desk to who has the most data feeding the model — which is precisely the fight Amazon wants.
Sponsored Prompts are the real land-grab
The merger of Rufus and Alexa+ into Alexa for Shopping looked like housekeeping. It wasn’t. Over 350 million people have used it in twelve months, active users nearly doubled in the quarter, interactions rose more than 5x, and US shoppers using it spend over 40% more per order. Conversational shopping compresses a page of roughly fifty results into about five named products and Amazon made the ads inside that answer billable in March, on a cost-per-click basis. It says shoppers who click a Sponsored Prompt convert 48% more often and spend 21% more, though those figures are Amazon’s own, not independently measured. Treat the specifics with caution, but not the direction of travel: agentic commerce is becoming a paid channel with brutally limited shelf space, and early movers are establishing pricing before the auction gets crowded. European brands still treating this as an experiment are ceding position.
Scarcity is Amazon’s new leverage in video
Every major live sports property Amazon carries Thursday Night Football, NBA, WNBA, NASCAR sold out its inventory. Sellouts are the clearest signal a media owner can send, because demand outstripping supply is what precedes pricing power at the upfronts. Amazon brought 30+ new advertisers to the NBA in its first year, and brands buying across multiple sports saw 2.3x higher unduplicated reach, 12% higher spend and 17% more orders. In Europe, NBA viewership on Prime Video more than doubled to its highest average on record. Amazon is now pitching streaming, live sport and retail media as a single full-funnel buy, and the sellout gives it the confidence to price accordingly. Expect harder negotiations this autumn.
Amazon Now is the underrated European story
The sub-30-minute delivery service is scaling faster than almost anything else in the business gross sales and units up over 80% quarter-on-quarter, 60% more customers served, now live in nine countries and 250+ cities and it landed in the UK in June Grocery and everyday essentials are outgrowing the rest of retail, and Amazon delivered 40% more items same-day or overnight in the first half. This is Amazon attacking the convenience basket, the trips it has historically lost to Tesco, Sainsbury’s and the discounters and it changes the frequency of the customer relationship, which in turn feeds the ad machine. These are positive signs that perhaps Amazon has finally cracked the grocery code
And then there’s Prime Day
Last year Amazon called it the biggest ever. This year, moved into June, there was no post-event release and no mention in the earnings statement and Amazon declined to explain the change when asked by the media. Third-party data suggests solid rather than spectacular: KeyBanc saw Prime Week spend up 41.7% versus 50.5% last year, and eMarketer estimates $15.7bn, up just 7.1%. Silence from a company that loves a superlative is itself a data point: Prime Day is maturing from a growth event into a margin and media event.
In summary, in this Q2 earnings report, Amazon let everyone marvel at the AWS Cloud numbers, glossed over Prime Day and demonstrated how they are remodelling their retail business around ads. Automation driving the ad business, Alexa + turning discovery into a five-slot shelf, live sport selling out, and Amazon Now buying them shopping frequency in Europe that will be sold back to advertisers as data.