Amazon Earnings: AI Demand Drives Fastest AWS Growth in Three Years, but Heavy Spending Weighs on Cash Flow
Amazon has positioned AWS at the center of its generative AI infrastructure strategy. It has invested $8 billion in Anthropic and signed a $38 billion computing partnership with OpenAI. Whether AI demand translates into cloud growth is critical to Amazon’s competition with Microsoft and Google, putting its data-center spending and investment payback period under scrutiny.
Amazon reported first-quarter results on April 30, 2026. AWS revenue rose 28% year over year to about $37.5 billion, its fastest growth in 15 quarters, or more than three years, while demand for Amazon’s in-house chips also increased. The company continued expanding AI data centers to support Anthropic and OpenAI, but the heavy capital spending caused free cash flow to fall significantly.
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The history behind this eventAmazon CEO Sees AI Driving AWS Annual Revenue Toward $600 Billion
Amazon Web Services, or AWS, is one of the world's leading cloud-computing platforms. Companies adopting generative AI rely on computing power, data storage and model services, making AI a new growth engine for the cloud market. Continued expansion at AWS would also directly affect Amazon's profit mix and intensify global competition for data-center investment.
Amazon CEO Andy Jassy now expects AI demand to help lift AWS annual revenue to $600 billion within the next 10 years, roughly twice the previous projection. AWS revenue rose 19% in 2025 to $128.7 billion, while its AI business reached $15 billion in annualized revenue, indicating that accelerating corporate AI spending is translating into demand for cloud services.
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