Amazon AWS Growth at 28% as AI Capex Forecast Tops $700B and Chip Unit Eyes $50B
AWS revenue grew 28% YOY in Q1 2026 versus Google Cloud’s 63% and Microsoft Azure’s 40%, underscoring intensifying AI infrastructure competition. Industry AI capex is set to reach US$700 billion by year-end as Amazon’s Graviton and Trainium chips hit a US$20 billion internal run rate with potential to scale to US$50 billion.
1. AWS Q1 Growth Performance
Amazon Web Services posted 28% year-over-year revenue growth in Q1 2026, trailing Google Cloud’s 63% and Microsoft Azure’s 40% and highlighting intensifying competition in AI infrastructure.
2. AI Infrastructure Capex Surge and Demand Uncertainty
Industry cloud service providers plan to invest a combined US$700 billion in AI infrastructure by the end of 2026, driven by rising memory chip prices and server demand, though timing for ASIC deployments remains uncertain.
3. Chip Business Expansion Plans
Amazon’s custom Graviton and Trainium chips are generating a US$20 billion annual run rate internally and could expand to US$50 billion through third-party sales once production capacity catches up.