Amazon investors are rewarding a powerful rebound in its cloud business, with Amazon Web Services delivering first-quarter revenue of USD37.6 billion, up 28% year on year. That pace marks AWS’s strongest quarterly expansion in three years and beats market forecasts for 25.1% growth to USD36.6 billion.
In after-hours trade, Amazon’s stock climbed 4.7% to USD263.04 as investors focused on the cloud momentum. The upbeat reaction comes despite ballooning capital outlays tied to the AI infrastructure race.
An aggressive investment cycle sits behind the rally, as Amazon spends heavily to meet future AI computing demand. Over the 12 months to 31 March, the group poured USD151 billion into property and equipment, an increase of USD59.3 billion on the prior comparable period.
First-quarter capital investment alone reached USD44.2 billion, up 76% year on year and above analyst expectations for USD41.4 billion. Management also guided for second-quarter operating income between USD20 billion and USD24 billion, with the USD22 billion midpoint landing just under the Street’s USD22.62 billion estimate.
Amazon’s custom chip push and AI-focused partnerships show how central infrastructure has become to its strategy. The company’s proprietary semiconductor business has now hit an annual revenue run rate above USD20 billion, reflecting customer uptake of in-house silicon.
Net income for the March quarter rose to USD30.3 billion, 77.2% higher than the USD17.1 billion a year earlier. Operating income climbed to USD23.9 billion from USD18.4 billion.
Longer term, Amazon is locking in multi-year AI workloads that could keep data centre demand elevated well into the next decade. Over the period, the company secured commitments from OpenAI to consume roughly 2 gigawatts of compute capacity on AWS infrastructure, with usage ramping from 2027.
New AWS agreements with Anthropic, Meta and Nvidia show that hyperscalers, major model developers and chip designers are increasingly intertwined. The deals position Amazon as a core infrastructure provider for generative AI, even as spending levels test investor comfort.
