Amazon Surpasses Tesla as AI Spending Takes Center Stage

Tesla and Amazon's Q2 2026 results exposed their differing AI strategies. Tesla spent heavily on robotaxis, Optimus, and training compute, but operating margins collapsed to 1.4%. In contrast, Amazon leaned on its AWS cloud business, advertising, and retail to fund its AI buildout without hurting its operating model.

AWS delivered $42.232 billion in revenue with a 39.4% operating margin, growing 37% year-over-year. Amazon's CEO, Andy Jassy, said that AWS is 'booming,' growing at the company's fastest rate in 18 quarters. The AI and Chips businesses each eclipsed $25 billion run rates.

Tesla reported revenue of $28.24 billion, up 25.52% year-over-year, but operating margin fell to 1.4%. Deliveries hit a record 480,126 units, Services and Other grew 50%, and active FSD subscriptions climbed to 1.48 million.

Amazon printed revenue of $200.606 billion with operating income of $27.461 billion, up 43.24% year-over-year. The company's capex reached $54.208 billion in a single quarter, pushing trailing free cash flow to -$7.6 billion.