Amazon Web Services posted $37.6 billion in net sales for the first quarter of 2026, a 28% year-over-year increase that CEO Andy Jassy described as the fastest growth rate for the unit in 15 quarters. The results were reported Wednesday, April 30, 2026, as part of Amazon’s broader quarterly earnings, which beat Wall Street expectations overall.
Jassy attributed AWS’s growth directly to demand from the AI industry. “We’ve never seen a technology grow as rapidly as AI. Amazon is already a leader, and companies continue to choose AWS for AI,” he said during the earnings call. He added that AWS’s AI revenue run rate has surpassed $15 billion in the first three years of the current AI wave — roughly 260 times the $58 million run rate AWS had three years after its original launch.
The strong cloud performance comes alongside a sharp rise in capital spending. Amazon reported that purchases of property and equipment increased by $59.3 billion year-over-year, covering land, power, data centers, chips, servers, and networking gear. That spending drove free cash flow down to $1.2 billion for the trailing twelve months — a 95% decline from the $25.9 billion recorded in the first quarter of 2025.
Jassy acknowledged the pressure on cash flow but framed it as a deliberate trade-off. “In times of very high growth like now — where the capex growth meaningfully outpaces the revenue growth — the early years, free cash flow is challenged,” he said. He noted that data center assets can last more than 30 years, while chips and servers carry a useful life of five to six years.
Amazon’s total first-quarter sales rose 17% year-over-year to $181.5 billion, with North American sales up 12% and international sales up 19%.
Source: TechCrunch