Amazon’s AWS posts fastest growth since 2021, citing AI and chip demand
AWS revenue jumped 37% as Amazon’s heavy AI infrastructure spending pushed free cash flow negative for the first time since 2023.
- On Thursday, Amazon reported strong second-quarter earnings, beating estimates as revenue growth accelerated to 20%, primarily driven by AWS performance.
- AWS revenues surged 37% year-over-year, with robust margin expansion validating Amazon's heavy investment in cloud infrastructure despite near-term free cash flow pressure.
- Aggressive capital expenditures totaled $54 billion in the second quarter, resulting in a $9 billion free cash flow burn that raises balance sheet considerations.
- Analyst Jonathan WeberAmazon noted that at 27x forward earnings, Amazon is not a bargain, favoring Microsoft and Alphabet for comparable growth at lower valuations.
- Amazon's capital-intensive approach prioritizes long-term market dominance and cash generation, though investors must weigh spending against potential liquidity constraints and financial durability risks.
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Amazon’s Trillion-Dollar AWS AI Bet
Amazon’s AI spending is beginning to deliver measurable results. TD Cowen Analyst John Blackledge joined Bloomberg Open Interest to explain why soaring AWS demand could keep Amazon capacity-constrained through 2027, how the cloud division could eventually reach $1 trillion in revenue, and why Andy Jassy’s AI message is resonating more strongly with investors than Meta’s. (Source: Bloomberg)
Amazon's shares came to rise more than 12% in the pre-market this Friday (31), after the giant of electronic commerce and computing recorded its strongest growth in the cloud area in more than four years, reinforcing investors' confidence that their billion-dollar bets in artificial intelligence are working. The high placed Amazon on the way to add about $300 billion in market value, as investors ignored a 10% increase in planned capital investm…
Amazon jumps as AWS growth soothes fears over its AI spending
Amazon shares jumped more than 12% after its cloud division posted its fastest growth in over four years, easing investor fears that the company’s ballooning AI spending was running ahead of the payoff. Amazon Web Services grew 37% in the
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