Amazon's $220 Billion Bet on Cloud Capacity

Amazon is now the only $3 trillion company that has never paid a dividend. The e-commerce giant joined this group recently, crossing the $3 trillion line for the first time on August 3.

According to Amazon's financials, its free cash flow over the past 12 months was an outflow of $7.6 billion. This is despite management planning about $220 billion of capital spending this year, more than four times what Amazon spent as recently as 2023.

The company's $10 billion buyback program has gone unused since 2022. Five companies command market values around $3 trillion or more: chipmaker Nvidia (NVIDIA), Apple (AAPL), Alphabet (GOOGL), Microsoft (MSFT), and Amazon (AMZN). Four of them pay quarterly dividends.

AWS revenue rose 37% year over year to $42.2 billion in the second quarter, with management saying it's 'booming.' Operating income climbed 43% year over year to $27.5 billion, with AWS contributing $16.6 billion of that. Net income more than tripled to $62.6 billion.