Amazon reports second-quarter 2026 results on July 30 with consensus expectations for $196.71 billion in total revenue and $1.82 per share in earnings. But the headline revenue number masks what Wall Street really cares about: AWS.

Bank of America raised its AWS growth forecast to 33% year over year for Q2, up from 31%. The upgrade reflects accelerating demand from Anthropic and OpenAI-powered Bedrock services, plus broader enterprise adoption of artificial intelligence. AWS Q1 2026 grew 28% to $37.6 billion. If BofA is right, that puts Q2 AWS on a path to mid-to-high 30s growth—genuinely impressive for a business that size.

Bedrock and AI Services Momentum

Bedrock is the product that makes this possible. It’s Amazon’s interface to multiple foundation models, letting enterprises build AI applications without committing to a single provider. That optionality is valuable, and AWS charges for compute hours. As customers experiment with multiple models and scale their usage, Bedrock revenue compounds.

The risk is that competitive pressure from Azure and Google Cloud could push prices down. Amazon has the infrastructure scale to compete on price, but margin compression is real. Investors need to hear management confirm that AI revenue is growing faster than the cost of serving it.

Retail and Operating Margin Story

Retail remains Amazon’s largest business by revenue but AWS is the profit engine. Retail margins are thin, and though advertising is profitable, it doesn’t move the needle enough to matter for the stock multiple. AWS margins matter because they fund everything else Amazon does. If AWS operating margins contract while growth holds steady, the stock sells off.

AWS guidance for Q3 will tell the real story. If growth is expected to stay above 30%, the bull case survives.