Amazon (Nasdaq: AMZN) has reported its sixth straight quarter of profit but missed analysts’ earnings estimates by a wide margin. As it continues to invest heavily in its growth areas and build out its infrastructure, analysts need to realign their expectations.

Amazon’s Financials

Driven by “Prime Day,” Amazon’s promotional sales holiday in early July, third quarter revenues grew 29% over the year to $32.71 billion, compared with the market’s expectations of $32.69 billion. Net income increased to $252 million or $0.52 per share from $79 million or $0.17 per share a year ago. Analysts forecast EPS of $0.78 per share.

By segment, net product sales increased 21% to $22.4 billion with its North America commerce segment growing 26% to $18.9 billion and International sales growing 28% to $10.6 billion. It reported a loss of $541 million for its international segment, compared to a loss of $208 million a year ago.

Net services sales grew 50% to $10.4 billion. Within the Net services segment, revenues from AWS grew 55% to $3.2 billion.

For the current quarter, Amazon projected revenues of $42 billion-$45.5 billion, compared with the market’s forecast of $44.6 billion. It forecast an operating income of $0 -$1.25 billion compared to $1.1 billion a year ago.

AWS

According to Synergy Research Group, AWS is the leader in the cloud market with nearly 31% of the global market share, while Google (GOOG) and IBM (IBM) together account for the next 22% of the market and the next 20 players in the market account for a combined 27%.

AWS accounts for the bulk of Amazon’s profit. Operating income from AWS doubled to $861 million in the quarter. It is expected to reach $10 billion in sales this year.

AWS also launched new capabilities for AWS Educate, a global program that provides students and educators with resources to accelerate cloud-related learning. The program now includes access to courses designed to teach cloud skills, paired with the AWS Educate Job Board, featuring cloud-related internships and jobs from top employers around the world.