Amazon AWS Q1 Revenue Up 28% and Chip Unit Hits $20B Run Rate
Amazon’s AWS revenue grew 28% in Q1 while its chip business hit a $20 billion run rate, fueling AI infrastructure expansion and boosting e-commerce automation. The stock trades at a 32× forward P/E even as free cash flow is forecast to turn negative in 2026 on multibillion-dollar AI data-center investments.
1. AWS and Chip Unit Growth
In Q1 2026, AWS revenue grew 28% year over year while Amazon’s in-house chip division achieved a $20 billion run rate, strengthening its cloud computing operations and supporting the rollout of AI hardware offerings.
2. E-commerce Automation Efforts
Amazon has deployed robotics and AI-driven automation across its fulfillment network, reducing processing times and labor costs, and launched same-day delivery for oral Ozempic and Wegovy, marking a significant expansion into fast-turnaround healthcare logistics.
3. Valuation and Cash Flow Outlook
Amazon’s shares trade at a 32× forward P/E multiple, reflecting high growth expectations, but free cash flow is projected to turn negative in 2026 as the company invests multibillion dollars in new AI data centers, potentially weighing on margins before long-term returns emerge.