Amazon's cloud arm is on track for $184 billion in yearly revenue, and its CEO says AI demand could push it toward $1 trillion within ten years.
Amazon Web Services, the cloud business behind a large share of the internet, is growing so fast that it may one day overshadow Amazon's shopping side. On its latest earnings call, CEO Andy Jassy said AWS should become a $1 trillion business in five to ten years, with AI demand as the main driver.
AWS is on track for $184 billion in revenue this financial year. Growth ran at 39.3 percent over last year, and third-quarter revenue came in just under $46 billion. Amazon as a whole brought in $180.17 billion for the quarter. Jassy said AWS could grow 40 percent or more in 2027 or 2028.
Jassy said Amazon installs a new AI accelerator about every 14 seconds. An accelerator is a specialized computer chip that runs AI work. He said customers are taking up that capacity almost as fast as it goes in.
Bedrock, AWS's AI service, is the fastest growing multi-billion dollar service in its history. Jassy also said that basic storage and computing grew at their fastest rates in several years. His view is that companies want AI running close to their data and apps, so AI use pulls in everyday cloud use too.
Building this is expensive. Amazon expects $220 billion in capital spending in 2026, and spent $75.9 billion last quarter alone, most of it on AWS. Jassy said the company can fund the plan. He also said margins on AI services are already well ahead of where AWS core services were at a similar stage.
Retail and operations revenue grew 6 percent, on much thinner margins. Jassy pointed to Prime Video, which he said has a revenue run rate in the tens of billions of dollars and is now profitable. If current growth rates hold, the report notes, Amazon could look like a cloud company with a retail sideline.
Businesses that run on AWS should expect a steady stream of new AI tools from Amazon. Jassy also noted that about 85 percent of global IT spending is still on company-owned equipment, and he expects that to shift to the cloud over 10 to 20 years.
The forecasts are Jassy's own, made on an earnings call. Nothing in the report says how prices for customers will change as demand grows.
If your business runs on AWS, expect more AI tools from Amazon and keep a close eye on your cloud costs as demand grows.
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