Amazon's $496 Billion Cloud Backlog Spells Huge Growth Ahead
Amazon's Amazon Web Services (AWS) division has seen its backlog climb to nearly $496 billion, indicating a strong demand for cloud computing services. This growth is attributed to the increasing use of artificial intelligence (AI) and machine learning in various industries.
AWS' operating margin reached 39% in the second quarter of 2026, significantly higher than Amazon's commerce segments. In fact, AWS accounted for 60% of Amazon's operating profits during this period.
Amazon is investing heavily in data centers to meet the growing demand for cloud computing services. The company expects to spend around $220 billion on capital expenditures this year, with nearly all of it going towards data centers.
Ceiling-high growth rates are expected as AWS' backlog continues to grow at a triple-digit percentage rate year over year. AI inference workloads run continuously, creating a recurring revenue stream for Amazon.