3M Stock Surges Over 5% on Expanded Amazon Data Center Deal and Earnings Beat

MMM shares rose about 5% on Tuesday, October 20, trading near $171 in early afternoon, on two pieces of news: an expanded data center relationship with AMZN and third-quarter results that beat on earnings and raised full-year guidance. The Amazon agreement was disclosed in an 8-K on Monday evening, October 19, and the stock had already climbed to $170.80 in after-hours trading from a $162.01 close.

Under the agreement, 3M issued a wholly owned Amazon subsidiary a warrant to buy up to 3,162,015 shares, roughly 3.2 million or about 0.6% of common stock, at $164.89 per share over seven years. 85% of the warrant shares vest as Amazon's payments for optical connectivity and other data center products accumulate, with full vesting once cumulative payments reach $6 billion; the remainder vest on event-based milestones. On the earnings call, management said there are no volume commitments, that the warrant vests in increments, and that it expects the business to ramp toward the back end of next year and become more meaningful in 2028.

The quarter itself was solid rather than spectacular. Adjusted EPS rose 12% to $2.50, above a consensus of about $2.38 to $2.39, while adjusted sales of $6.6 billion grew 3.3% organically and came in slightly below the roughly $6.61 billion estimate, according to the company's results release. Adjusted operating margin expanded 110 basis points to 26.2%. 3M raised its 2026 adjusted EPS guidance to $9.10 to $9.15 from $8.95 to $9.10, its third straight quarterly raise. One caveat for comparisons: 3M now treats intangible-asset amortization as a special item, which added about $0.04 to adjusted EPS. The prior range was restated on the same basis, so the roughly $0.10 midpoint increase is operational.

What to watch: how fast Amazon's purchases actually build toward the $6 billion vesting threshold, given that management does not expect a meaningful contribution until 2028; whether other hyperscalers sign similar optical connectivity deals; and whether organic growth can accelerate from 3.3% as the data center business scales. The $6 billion is a vesting trigger, not committed revenue, so the deal's value to 3M depends on Amazon's buildout pace.