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Amazon reported $155.667 billion in net sales for the quarter ended March 31, 2025, up from $143.313 billion a year earlier—a reported increase of approximately 9%. Excluding a $1.4 billion unfavorable foreign-exchange effect, growth was approximately 10%. The results were announced on May 1, 2025, so this is a historical Q1 2025 result, not Amazon’s latest quarterly revenue; Amazon reported $181.519 billion in net sales for Q1 2026.
The more important story behind the headline was mix: AWS and advertising grew much faster than Amazon’s total sales and contributed disproportionately to operating profit, while heavy infrastructure investment reduced trailing-twelve-month free cash flow.
What increased in Q1 2025?
Amazon’s reported net sales rose $12.354 billion year over year. Product sales increased to $63.970 billion from $60.915 billion, while service sales rose to $91.697 billion from $82.398 billion. Services therefore supplied the larger share of the dollar increase. Amazon’s service businesses include third-party seller fees, AWS, advertising, subscriptions and digital content.
The company’s official release reports the 9% growth rate and approximately 10% growth after removing foreign-exchange effects: Amazon’s Q1 2025 earnings release.
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Revenue by business category
| Category | Q1 2025 | Q1 2024 | Year-over-year growth |
|---|---|---|---|
| Online stores | $57.407 billion | $54.670 billion | 5% |
| Physical stores | $5.533 billion | $5.202 billion | 6% |
| Third-party seller services | $36.512 billion | $34.596 billion | 6% |
| Advertising services | $13.921 billion | $11.824 billion | 18% |
| Subscription services | $11.715 billion | $10.722 billion | 9% |
| AWS | $29.267 billion | $25.037 billion | 17% |
| Other | $1.312 billion | $1.262 billion | 4% |
| Total | $155.667 billion | $143.313 billion | 9% |
These figures come from Amazon’s filing: revenue-category table. Online stores remained the largest individual category, but AWS and advertising were the fastest-growing major categories shown.
AWS was the profit engine
AWS sales grew 17% to $29.267 billion, yet AWS operating income rose to $11.547 billion from $9.421 billion. Based on Amazon’s reported segment figures, AWS represented approximately 18.8% of consolidated revenue but generated approximately 63% of total operating income. Those percentages are calculations from the reported numbers, not separately disclosed company metrics.
Amazon’s total operating income was $18.405 billion, so AWS operating income exceeded the combined $6.858 billion produced by North America and International. AWS’s operating margin was approximately 39.5%, far above the retail segments.
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The results are consistent with continuing demand for cloud capacity, including infrastructure used for generative-AI workloads. Amazon has discussed its Trainium2 chips, Bedrock model services and additional data-center capacity, but the reported figures do not isolate AI revenue or prove that AI alone caused AWS’s growth. More capacity and AI investment can support future sales while requiring substantial capital spending.
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Segment income and revenue figures are reported in Amazon’s filing: Q1 2025 segment results.
Advertising grew about twice as fast as Amazon overall
Advertising services increased 18%, from $11.824 billion to $13.921 billion. Amazon defines this category as advertising sold to sellers, vendors, publishers, authors and other customers through its advertising programs.
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Advertising monetizes shopping intent that already exists on Amazon and does not require Amazon to buy and resell the advertised product. That service-business model can be more profitable than low-margin retail sales, although results depend on continued demand from sellers, brands and vendors. Advertising’s 18% growth was roughly double Amazon’s 9% consolidated rate.
Retail and geographic performance
North America
North America generated $92.887 billion in sales and grew 8%. Operating income increased to $5.841 billion from $4.983 billion. It remained Amazon’s largest reported segment by revenue.
International
International sales were $33.513 billion, up 5% on a reported basis, with operating income of $1.017 billion versus $903 million. Excluding foreign-exchange effects, Amazon said International growth was approximately 8%. The correct figure is $33.513 billion—not $35.5 billion.
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AWS
AWS contributed $29.267 billion in sales and $11.547 billion in operating income. It is an Amazon reportable segment, not a separate company, and its revenue was lower than North America’s even though its operating income was substantially higher.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Profit improved, but net income needs context
Operating income rose from $15.307 billion to $18.405 billion, lifting the operating margin to approximately 11.8% from approximately 10.7%. Diluted earnings per share increased to $1.59 from $0.98.
Net income increased from $10.431 billion to $17.127 billion. That is a 64% year-over-year increase, but it should not be read as a 64% improvement in core operating performance. Amazon reported $3.274 billion of total non-operating income in Q1 2025, compared with a $2.324 billion non-operating expense in Q1 2024. Investment results and other non-operating items therefore amplified the increase below operating income.
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Cash flow showed the cost of expansion
Contemporary reporting put Amazon’s trailing-twelve-month free cash flow at approximately $25.9 billion, down from approximately $50.1 billion a year earlier: contemporary coverage of the results. This is a 12-month measure, not cash generated only during the three-month quarter.
Free cash flow subtracts capital expenditures from operating cash flow. Amazon’s investment in data centers, servers, networking and other infrastructure—especially to expand AWS and AI capacity—can depress free cash flow even while accounting profit and operating income rise. Investors should therefore track the income statement and cash generation separately.
What Amazon guided for next
For Q2 2025, management guided to net sales of approximately $159 billion to $164 billion, implying expected year-over-year growth of approximately 7% to 11% based on the guidance issued in May 2025. The range was management’s forecast at that time, not actual performance or a current 2026 outlook.
Amazon highlighted uncertainty involving trade conditions, tariffs and foreign exchange. Those factors could affect product costs, consumer demand, reported international sales and margins. AWS capacity constraints and continued infrastructure spending were additional execution considerations. The guidance appears in the company’s release: Q2 2025 outlook.
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- Growth was solid but not purely retail-driven. Online stores were still the revenue foundation, while AWS and advertising expanded faster.
- The mix was more profitable. AWS supplied approximately 63% of operating income on less than one-fifth of sales, based on Amazon’s reported figures.
- Operating improvement was clearer than the net-income jump. Higher operating income reflected business performance; non-operating gains also boosted net income.
- Investment created a cash-flow trade-off. The lower trailing-twelve-month free-cash-flow figure reflects the cost of building long-term cloud and AI capacity.
- AI should not be treated as the sole explanation. Amazon’s disclosed results combine broad AWS demand with AI-related investment and do not provide a standalone AI revenue figure.
For context, Amazon’s March 2026 filing reported $181.519 billion in quarterly net sales, confirming that the $155.7 billion figure belongs specifically to Q1 2025: Q1 2026 results.
Bottom line
Amazon’s Q1 2025 revenue growth was healthy, but the quarter was more significant for where growth came from than for the 9% headline alone. Retail remained the sales base; AWS and advertising were the strategic and financial growth engines. Amazon improved operating profit while spending heavily on the infrastructure needed to extend those businesses, leaving investors to balance stronger earnings against weaker free cash flow and a more uncertain near-term outlook.
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