Amazon's AWS Segment Surges Past $169 Billion Amid AI Growth

Amazon's AWS segment has reached a $169 billion annualized revenue run rate after growing 37% year over year to $42.2 billion in the second quarter.

The AI business within AWS, which has passed a $25 billion annual revenue run rate, is growing at triple-digit percentages year over year and could decide Amazon's five-year return on its own.

If the AI business doubles just twice more by 2031, it would take the line from $25 billion to about $100 billion of annual revenue. The rest of AWS, currently a $144 billion run rate, growing at 12% to 15% a year, could reach between $250 billion and $290 billion.

AWS's operating margin expanded to about 39% in the second quarter, up from around 33%, and its backlog of contracted work reached $496 billion. The segment's operating income reached $16.6 billion for the quarter, up about 64% year over year.