Amazon AWS Lags Google at 28% Growth; Chip Spin-Off Could Hit $50B
Amazon Web Services revenue rose 28% in Q1 2026, trailing Google Cloud’s 63% and Microsoft Azure’s 40% growth during an AI infrastructure buildout. Management may spin off its custom Graviton and Trainium chip business to external customers, targeting up to $50 billion in revenue as global cloud capex surges toward $700 billion.
1. AWS Q1 Growth Trailing Competitors
Amazon Web Services reported 28% year-over-year revenue growth in Q1 2026, behind Google Cloud’s 63% and Microsoft Azure’s 40% expansions during the AI infrastructure buildout.
2. Proposed Graviton and Trainium Chip Spin-Off
Amazon plans to offer its custom Graviton and Trainium chips to third-party customers, aiming to scale the business to an estimated $50 billion in revenue once production capacity meets external demand.
3. Escalating Global Cloud Capex
Cloud service providers are pushing total capital expenditures toward $700 billion by year-end to support AI and data center expansion, highlighting sustained demand for infrastructure investments.