AWS to Hit $1 Trillion Revenue — But Amazon Must Spend $220B First

Andy Jassy says AWS can become a trillion-dollar revenue business — but Amazon will spend roughly $220 billion in cash capex in 2026 alone to get there, the majority of it on AWS, with even bigger outlays planned for 2027.

The Amazon CEO made the pledge on the company's quarterly earnings call Thursday, repeating an ambition he has voiced before.

"What we're building at Amazon is unlike anything that's ever been seen before. There has never been a business with a trillion dollars of annual revenue," Jassy said.

What does the spending actually buy?

Amazon's AI infrastructure buildout has rattled investors all year. On Thursday's call, Wall Street analysts pressed Jassy repeatedly on three points: why the spending, what signals prove the growth will come, and what profit margins to expect.

Jassy's answer: this is a historic moment in global cloud demand driven by AI, and the money is well placed. The numbers back him up so far. AWS revenue grew 39% year over year last quarter — steady growth for the sixth straight quarter. Put that in frame: AWS is already running at a $184 billion annualized revenue pace.

For context, a 39% growth rate on a business of that size means AWS is adding revenue each year at a scale most Fortune 500 companies would envy as their entire annual turnover.

Jassy forecast that growth will accelerate, not fade. He told analysts AWS revenue will increase 40% not just next year but in 2028 as well.

"AWS is a $184 billion annualized revenue run-rate business, and yet the opportunity remains extraordinary," the CEO said. "With our continued pace of innovation, new core and AI functionality, enterprises wanting to run their core and AI workloads in AWS, and the amount of capacity that we're adding each year, we believe that AWS can grow north of 40 percent in each 2027 and in 2028, and be a trillion-dollar revenue business in the next five to 10 years."

He added that enterprise AI adoption is still "in the very early days" and said that, so far, the "strategy is working."

Why the capex is so large

Asked directly why growing AWS requires such substantial investment, Jassy called the AI boom a "once in a lifetime opportunity" — one that demands, and justifies, a big financial commitment right now.

"We're going to invest to continue being the leader," he said. "We can fund this plan, and I think it will forever change the size of Amazon. It will forever change our revenue."

The capex guidance itself was blunt. "We still expect 2026 cash capex of approximately $220 billion — the majority for AWS — and expect to spend meaningfully more in 2027, with a clear line of sight to attract its financial returns," Jassy said on the call.

To translate: $220 billion in a single year is roughly two-thirds of AWS's entire current annualized revenue base, spent in twelve months, mostly on the cloud unit's data centers and compute capacity.

What does this change for investors?

Not everyone is convinced. Investors stayed worried despite the growth figures, and Amazon shares fell about 6% in after-market trading Thursday.

That tension — record growth alongside record spending — defines the entire cloud sector right now. The AI boom has been a mixed blessing for cloud providers. AI services run on cloud infrastructure, so demand surges, but supplying that demand demands enormous upfront capital.

Amazon isn't alone. Microsoft just posted more record-breaking revenue growth, driven largely by its cloud business. It, too, has spent heavily to build out capacity.

The bet Jassy is asking shareholders to underwrite is straightforward: spend hundreds of billions now, capture 40%-plus annual growth through 2028, and turn a $184 billion run-rate business into a trillion-dollar one within five to ten years. Thursday's after-hours sell-off shows the market still wants proof that the returns arrive on that timeline.