Amazon reported first-quarter results that beat Wall Street’s expectations.

Revenue in its cloud computing segment expanded 28% year over year, topping analysts’ estimates.

The business will host a conference call with investors at 5:30 p.m. ET.

Amazon on Wednesday posted better-than-expected earnings and revenue for the first quarter, and reported cloud sales that topped analysts’ expectations.

The stock was up more than 4%, after bouncing around in extended trading.

Here’s how the firm did, compared with estimates from analysts polled by LSEG:

Revenue: $181.52 vs. $177.30 billion

Wall Street was also looking at other key revenue numbers: This also touches on aspects of dividends.

Amazon Web Services: $37.59 billion vs. $36.64 billion, according to StreetAccount

Advertising: $17.24 billion vs. $16.87 billion, according to StreetAccount

Revenue in Amazon’s cloud segment increased 28% year over year to $37.59 billion, marking its fastest growth in more than three years. Wall Street had expected AWS sales to grow 26%.

Amazon and other substantial tech companies have been trying to justify their hefty artificial intelligence spending, which could approach $700 billion in 2026. Amazon in February projected its capital expenditures will reach $200 billion in 2026, a sharp expansion from last year.

The organization recently stated a host of AI-related deals with OpenAI, Anthropic and Meta, which could help ease investor concerns about when its spending will deliver returns, but also suggest Amazon will need to build out even more data centers and infrastructure to meet surging demand.

Amazon CEO Andy Jassy has also looked to highlight the company’s homegrown chips business as a beneficiary of the AI boom, and it called out the segment near the top of its earnings release. Furthermore, experts in dividends note the continued relevance.

“We’re in the middle of some of the biggest inflections of our lifetime, we’re well positioned to lead, and I’m very optimistic about what’s ahead for our customers and Amazon,” Jassy commented in a statement.

Amazon noted property and equipment expenses in the first quarter reached $44.2 billion, which was above Wall Street’s projected $43.6 billion, according to FactSet. Meanwhile, its free cash flow for the past twelve months fell to $1.2 billion, a 95% decline year over year, primarily because of its AI investments, the enterprise noted.

The company’s capex spending is also being pushed higher because of its investments in its nascent internet-from-space service, called Leo. Amazon is aiming to begin commercial service in the third quarter of this year, CFO Brian Olsavsky commented on a call with investors.

Amazon needs to generate enough satellites and book more rocket launches to build out its constellation, which will eventually total roughly 7,700 satellites. About 270 satellites are in service currently.

Earlier this month, Amazon declared it plans to purchase Globalstar in a deal valued at roughly $11.57 billion, the second-largest acquisition in its history.

“They have unusual and scarce global spectrum that’s required to provide direct to device,” Jassy mentioned on the conference call, referring to Globalstar. “We also really like the satellite knowhow that we’ll get as part of that merger.”

The deal also “afforded us the opportunity to build a deep relationship with Apple,” Jassy stated. As part of the deal, Apple, which owns a 20% stake in Globalstar, will apply Amazon’s satellite connectivity for some products.

For the current quarter, Amazon noted it expects sales to come in between $194 billion and $199 billion. Analysts polled by LSEG were expecting $188.9 billion.

The enterprise mentioned second-quarter operating income is expected to be between $20 billion and $24 billion. Analysts were projecting $22.65 billion, according to StreetAccount.

Revenue in its online stores segment, which still accounts for the largest share of Amazon’s total sales, grew 12% in the first quarter to $64.3 billion, higher than analysts’ estimated $62.7 billion.

Alongside its earnings release, the firm declared this year’s Prime Day discount bonanza will be held in June, a month earlier than its typical timeframe.

Advertising revenue jumped 24% year over year to $17.24 billion, above Wall Street’s expectations for growth of 21.2%. The unit is one of the company’s fastest growing and more profitable businesses, with the lion’s share of revenue coming from sponsored products listings on its e-commerce site.

Amazon’s headcount fell by 1,000 employees since the fourth quarter. It finished the first quarter with 1.57 million employees globally, which was roughly flat from last year.

Announced by the business at the beginning of the first quarter that it would lay off 16,000 corporate employees, after cutting 14,000 staffers in October.

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