Amazon seen well-positioned going into Q2 report on AWS momentum, Prime Day spending

Jefferies says Amazon is well positioned ahead of its Q2 earnings report, supported by strong Prime Day spending, resilient consumer demand and accelerating AWS growth. A consumer survey found 54% of returning Prime Day shoppers spent more than 10% year over year, while 25% said they use Amazon more for value amid inflation. The biggest earnings driver is AWS, with Jefferies expecting revenue growth of about 32% in Q2 and backlog approaching $500 billion, helped by AI-related demand, Anthropic’s expanded cloud commitment and EC2 price increases. The note also argues Amazon’s valuation remains attractive versus peers and its own historical average. Market focus will be on capex guidance, free cash flow, AWS demand and the fact that Prime Day shifted into Q2, which could make third-quarter retail comparisons tougher.