Amazon AWS Growth Surges 37%, Easing AI Spending Concerns

Amazon's quarterly revenue growth exceeded expectations, reaching 37% year-over-year. This strong performance sent Amazon shares soaring over 15% in a single session.

The company's AWS division was responsible for much of this growth, with its $220 billion capital expenditure guidance - an increase of $20 billion from previous projections - largely earmarked for AI infrastructure.

CEO Andy Jassy addressed concerns that AI spending is an expensive bet without a clear return timeline during the earnings call. His responses, paired with AWS's impressive numbers, seemed to put these doubts to rest.

The implications of this development extend beyond Amazon itself. Microsoft reported similarly strong results earlier in the week, suggesting that major cloud platforms are not only investing heavily in AI but also beginning to monetize it at scale.