Amazon Boosts Spending Plan as AWS Growth Continues
Amazon has raised its capital expenditure forecast for 2026 to $220 billion, up from an earlier estimate of $200 billion. The increase is due to higher memory and component costs, as well as continued spending on artificial intelligence and cloud infrastructure. AWS revenue grew 36.7% year over year to $42.2 billion, marking its fastest growth rate in 18 quarters.
The company's cloud unit reached a $169 billion annualized revenue pace, with demand for AI computing and cloud services remaining strong. AWS operating margin rose to 39%, about 650 basis points above the same period last year. Its backlog reached $496 billion, more than twice the level reported a year earlier.
Amazon is increasing its use of in-house chips to support AI workloads. Trainium and Graviton products have surpassed a $20 billion annual revenue run rate, while Amazon is deploying the newer Trainium3 platform for large AWS customers.