Amazon topped estimates and guided ahead of the Street for current-quarter sales, but I don’t know if it’ll be enough for investors.

Q2 revenue of $167.7 billion was up 13.3% YoY. Analysts were looking for $162 billion, give or take. The mid-point of the company’s original guide for last quarter was $161.5 billion.

As the figure below shows, the YoY pace of sales growth in Q2 was actually the best since the holiday quarter in 2023.

The company guided for between $174 billion and $179.5 billion in sales this quarter. Taking the mid-point, top-line growth would decelerate to 11.2%. That’d be better than the Q3 consensus as it stood headed into results.

AWS sales, what investors care most about, rose 17.5% versus the same period a year ago to $30.9 billion. That was “just” in line. Maybe a touch better. Not bad by any stretch. But probably not enough to impress, particularly in the context of blowout reports from Microsoft (where Azure growth was 39%) and Meta.

Andy Jassy talked up AI which “will change every customer experience.” After running through the usual compendium of ostensible milestones hit during the quarter, Jassy described a company (his, or Jeff’s) that’s leveraging AI to improve the “speed of innovation, operational efficiency and business growth.”

The problem here, assuming you want to find one, is probably the current-quarter (i.e., Q3) operating income guide which, at $18 billion taking the mid-point, wouldn’t represent much in the way of growth. Net income rose sharply in Q2, though, and EPS of $1.68 counted as a big beat.

I’m just speculating, but markets may be inclined to deemphasize the top-line beat and relatively rosy sales guide while frowning at the “merely in-line” AWS readout and underwhelming profit growth forecast. Expenses in AWS are growing significantly faster than sales.

Meanwhile, Apple managed a big beat on the top-line. And thank God for that, because things aren’t going especially well at the world’s best company. Revenue of $94 billion easily topped the $89.2 billion consensus for the company’s fiscal Q3.

As the figure above shows, the YoY growth rate was the best since the holiday quarter of 2021. Recall that Apple previously warned on nearly a billion in drag from tariffs in Q3. But the 10% growth rate ended up much better than the company’s guide.

iPhone sales of $44.58 billion beat by nearly $5 billion and rose by 13.4% from the June quarter last year. That’s good and, again, it’s a relief. This is typically a slow quarter for Apple and the shares are under pressure. You could argue the bar was thus low, but it’s probably more accurate to say investors were approaching a final straw moment. Seasonal slowdown or not, this report had to be decent.

Greater China sales — a sore spot for investors nervous that Tim Cook’s having issues with the company’s foothold in an increasingly competitive, not to mention increasingly patriotic, Chinese consumer market — managed a 4% YoY gain to $15.37 billion. I don’t speak for anyone other than myself, but as an investor, I’ll take it. In a testament to just how tenuous that situation is, Apple’s closing a store in China for the first time ever next month.

Elsewhere, services sales of $27.42 billion likewise beat estimates, albeit not by a lot. Margins were better, operating income rose 11% and EPS of $1.57 beat by $0.17. Apple provided no guidance in the press release.

“Today Apple is proud to report a June quarter revenue record with double-digit growth in iPhone, Mac and Services and growth around the world, in every geographic segment,” Cook beamed.

While applauding what was undoubtedly a better-than-feared quarter, there’s no use dancing around the issue: Apple’s AI rollout, if you can call it that, is a failure. The goggles too. Cook would dispute this vociferously, but innovation’s nowhere to be found at Apple these days, and that’s a huge problem when you’re the world’s preeminent consumer electronics company.

I think everyone agrees that Cook’s a fantastic CEO. His legacy is (more than) secure. But with sincere thanks for a job well done — and also for being a generally good person — it’s probably time for him to consider a transition.