Amazon Boosts Tech Spending to $220 Billion Amid AI Momentum

Amazon's capital spending on technology will increase by $20 billion to $220 billion this year, driven largely by its AI and cloud computing businesses. This represents a 10% boost from the company's initial estimate of $200 billion announced in February.

The tech giant reported strong profits and net sales for its second quarter, with AWS sales surging 37%, marking its fastest growth rate in 18 quarters. CEO Andy Jassy attributed the increase in capital spending to the higher cost of memory chips.

Jassy noted that even at the $220 billion level, Amazon will not have enough capacity to meet all of the demand it has this year, and predicted a similar situation for 2027 and beyond. The company's AI momentum is being driven by its partnerships with OpenAI and Anthropic, among others.