📊 AWS could become a $1 trillion business, Jassy says
📅 29 October 2026 • TechCrunch
Amazon chief executive Andy Jassy said on the company's third quarter earnings call that AWS can become a $1 trillion annual revenue business in the next five to ten years. The comment came with numbers attached. AWS segment sales grew 39 percent year over year to $46.0 billion, which Amazon described as the fastest growth in nearly five years and the sixth straight quarter of acceleration. That leaves AWS at a $184 billion annualized revenue run rate. Jassy framed the current moment as the early stage of an inflection driven by enterprise demand for AI capacity.
The ambition is paired with spending. Amazon continues to expect 2026 cash capital expenditures of approximately $220 billion, the majority for AWS, and Jassy told analysts the company expects to spend meaningfully more in 2027, with what he called a clear line of sight to attractive financial returns. Cash capex was $75.9 billion in the third quarter alone. He forecast that AWS revenue growth stays north of 40 percent in both 2027 and 2028. Supporting figures from the call include a $578 billion backlog growing at triple digit rates year over year, an AI accelerator installed about every 14 seconds, and AWS operating income of $17.8 billion at a 38.7 percent operating margin. AI revenue inside AWS is growing at triple digit rates year over year, and inference already accounts for well over half of AWS AI revenue.
Investors focused on the cash burn. Amazon shares fell about 6 percent in extended trading after the report. Quarterly revenue of $201.9 billion came in slightly below analyst expectations, as did earnings per share of $1.89, and free cash flow was an outflow of $42.4 billion for the trailing twelve months as equipment purchases rose. For context, Microsoft earlier in the week lowered its own 2026 capex outlook to $170 billion while Alphabet held its guidance, and Amazon's full year 2025 capital spending was roughly $128 billion. Amazon also guided fourth quarter revenue to a range of $240 billion to $247 billion, whose midpoint came in below analyst expectations, and operating income to $28.5 billion through $33.5 billion. Jassy opened by noting that there has never been a business with a trillion dollars of annual revenue and that Amazon may have two of them in the next five to ten years, naming AWS and the retail business.
IMPACT: AWS is now sized like a national cloud utility, so its capital plan has become a direct read on how fast AI infrastructure demand is expected to grow through 2028.
Continue the conversation: https://t.me/AIAutomationArchitecture · Bluesky
Top comments (0)