Amazon reported record third-quarter operating profitability, with operating income up 61% to $28.1 billion on revenue of $201.9 billion, even as shipping costs rose 11% year over year due to fuel inflation and higher line haul rates. Operating margin hit an all-time high of 13.9%. North America revenue reached $112.9 billion and international revenue $43.1 billion. CFO Brian Olsavsky said better inventory placement and package consolidation lowered cost to serve, while CEO Andy Jassy noted the company now runs more than 1 million robots. Amazon guided fourth-quarter sales to $240 billion-$247 billion.
According to www.freightwaves.com, Amazon reported record operating profitability in the third quarter, posting an operating margin of 13.9% even as shipping costs climbed 11% year over year amid fuel inflation and higher line haul rates.
The Seattle-based e-commerce and logistics giant said third-quarter revenue reached $201.9 billion, up 12% from $180.2 billion a year earlier. Operating income surged 61% to $28.1 billion, compared with $17.4 billion in the same period last year, according to the report.
Revenue came in below Wall Street estimates of $202.3 billion, while earnings per share of $1.89 fell short of the expected $1.96. The 13.9% operating margin was Amazon’s highest ever, as improvements across retail and cloud computing helped offset higher expenses.
Freight inflation pressures fulfillment network
Chief Financial Officer Brian Olsavsky said the fulfillment team navigated higher transportation costs driven by fuel inflation and elevated line haul rates. Shipping costs rose 11% year over year against 12% growth in units shipped, the source states.
Excluding fuel and linehaul inflation, shipping costs increased 8%, roughly 4 percentage points slower than unit growth. Amazon still lowered its overall cost to serve during the quarter through better inventory placement, shorter shipping distances and package consolidation, Olsavsky said.
“We’re on track to reduce cost to serve per unit for the fourth consecutive year.” — Andy Jassy, Amazon CEO
Amazon implemented a fuel surcharge earlier this year for sellers using its Fulfillment by Amazon service, recovering some higher fuel expenses. Jassy said the surcharge does not fully offset the increases, leaving Amazon exposed to higher costs on inbound retail shipments and outbound deliveries.
North America and international results
The North America segment, covering U.S. and Canadian retail operations, generated $112.9 billion in third-quarter revenue, up 6% year over year. Segment operating income jumped to $8.7 billion from $4.8 billion, an increase of approximately 81%, with an operating margin of 7.7%.
International revenue increased 5% to $43.1 billion, while international operating income climbed to $1.6 billion from $1.2 billion. Amazon noted that the timing of Prime Day affected year-over-year comparisons, since the event fell in the second quarter of 2026 for most major markets versus the third quarter in 2025.
Excluding that timing change, Amazon estimated third-quarter revenue growth would have been approximately 4 percentage points higher. The company also reported its fastest third-quarter delivery speeds ever for Prime members, delivering more than 1.5 billion items same-day or overnight in the quarter ending Sept. 30.
Robotics push passes 1 million units
Automation remains central to Amazon’s strategy to lower fulfillment expenses. Jassy told analysts the company now operates more than 1 million robots across its fulfillment network, contributing to improved productivity, reduced operating costs and record-low safety incident levels.
Amazon doubled its fleet of robotic arms, including the Cardinal and Sparrow systems, during 2026, according to Olsavsky. The company is also developing robotics foundation models designed to help machines perform increasingly complex physical tasks.
Jassy said transportation cost pressures are expected to continue into the fourth quarter, with the fuel and linehaul impact somewhat higher than in the third quarter. Amazon forecast fourth-quarter net sales of $240 billion to $247 billion, representing growth of 12% to 16%.
The company guided fourth-quarter operating income to $28.5 billion to $33.5 billion, compared with $25 billion in the year-earlier period, per the report.
Source: FreightWaves
Compiled from international media by the SCI.AI editorial team.
