Reported by 2 outlets
The story so far
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AWS sales grew 39 percent year over year, marking its sixth consecutive quarter of steady growth, and Jassy forecast the unit will expand by more than 40 percent in both 2027 and 2028. [1]
AWS has faced immense demand from AI labs such as Anthropic and OpenAI, alongside traditional enterprise clients, leaving cloud capacity largely booked through 2027 and into 2028. Jassy described the surge in AI adoption as a once-in-a-lifetime opportunity and predicted AWS could expand into a trillion-dollar annual revenue business over the next five to 10 years. However, heavy investments in data centers, chips, and related hardware previously pushed Amazon to negative $7.6 billion in free cash flow for the 12 months ending in June. [1][2]
The massive capital requirements continue to unease Wall Street, causing Amazon shares to fall roughly 6% in after-hours trading following the call. While competing cloud providers such as Microsoft are also spending heavily to support the AI boom, Amazon's aggressive outlays highlight persistent tensions between long-term cloud capacity expansion and immediate shareholder profitability. [1]
Amazon reports third-quarter earnings Thursday with more demand for its AWS cloud services than it can supply, after CEO Andy Jassy said capacity is booked for this year and most of next. Analysts expect revenue of about $202 billion, up 12%, as investors look for signals about the company's spending plans for 2027.
via GeekWire
Amazon wants to be the king of AI cloud computing and become the first $1 trillion revenue business. But to do that it will have to continue on its capex spending spree, its CEO said Thursday.
via TechCrunch