Amazon’s Cloud Surge Wins Over Wall Street

There’s no doubt about it: AI gave the big cloud firms a lift in business in the June quarter. We’ve already heard that from Google and Microsoft, and on Thursday, Amazon, the biggest cloud firm, followed suit by posting 37% growth in its Amazon Web Services cloud unit for the quarter. That’s 9 percentage points faster than it reported for the March quarter, and more than double the growth rate for the same period last year. 

Just as strikingly, AWS’ operating profit margin also rose, to 39.4%, the highest since the start of last year. To lift its operating margin while grappling with rising depreciation expenses on new chips and servers is an accomplishment. Amazon stock jumped 9% in response, suggesting investors were more focused on AWS’ accelerating growth than on the huge capital investments it is making to drive future growth. As a reminder of the size of those investments, Amazon burned $7.6 billion in cash in the quarter and raised its 2026 capital expenditures projection by $20 billion to $220 billion.