Amazon reported second-quarter results exceeding guidance, with revenue up 12% to $167.6 billion and operating margin at 11.4%. Upside seen in online stores, third-party sellers, subscriptions, and advertising. Fair value estimate raised to $245 per share. AWS results were solid, but margin performance down from first quarter. Guidance mixed compared to FactSet estimates.

Concerns around AWS margin performance and capacity constraints impacting stock. AI workloads growing over 100% annually. Amazon’s profitability fluctuates, overall margins remain strong. Satellite launch costs for project Kuiper may pressure margins temporarily. New AWS capacity coming online later in the year will also impact margins.

Read more at Morningstar: Good Results, With AWS Still a Winner, Raising Our Fair Value