When Amazon.com reports its second-quarter earnings on Thursday afternoon, Wall Street analysts expect continued strength from the retail and tech giant. The focus will be on the artificial intelligence powered growth of the Amazon Web Services cloud, but questions about the effects of tariffs on Amazon’s retail operations will likely come up.

The analyst consensus is for earnings per share of $1.33, up from $1.26 last year, on sales of $162 billion, up 10%.

While less than 20% of Amazon’s revenue comes from AWS, it accounts for around 60% of its operating income, so the segment takes on added importance, especially in a time of AI-fueled growth. Second-quarter AWS sales are expected to expand by 17% on the year, with similar growth for profit, outpacing the rest of Amazon.

The company is making significant investments into its cloud, building more AI data centers to rent out to customers. To date, demand for AI cloud at AWS and elsewhere has been outstripping supply, and Amazon expects to spend more than $100 billion in capital expenditures in 2025 for more capacity.

Also deep into the AI arms race, Meta Platforms and Alphabet have increased their capex guidance for 2025, and investors should be on the lookout for a possible increase from Amazon. As depreciation costs from all this capex mount, analysts will be keeping a close eye on AWS operating margins.

And then there is the four-fifths of Amazon that isn’t AWS, mostly retail. Adding up online and physical stores along with the website’s third-party seller services, revenue is expected to hit $103 billion, up 7% from the year before. It’s a testament to the strength of Amazon’s brand that such a mature business can maintain that sort of growth.

Lately, the wild cards in Amazon’s financials have been its fast-growing subscription and advertising sales. Together they are expected to reach $27 billion in second quarter sales, up 14% annually, with ad sales leading the charge at 17% growth.

The cloud hanging over the proceedings are tariffs, and their effect on Amazon’s cost of goods sold and gross margin. Because of implementation lags and changing pronouncements from the White House, the full effects of tariffs haven’t been felt yet. The average U.S. tariff rate in the first quarter was 2.4%, but that rose to 6% in April, 8% in May, and 10% in June. This number will likely keep rising as new tariffs become effective.

So the impact of the taxes on Amazon’s costs were probably minor in the second quarter, but higher average tariffs in the third quarter may come to weigh on the company’s guidance for its operating income. This could lend a sour note, even if Amazon reports a strong second quarter.