Amazon AWS Q1 Revenue Up 28% with Triple-Digit AI Chip Growth
Amazon Web Services grew revenue 28% in Q1 2026, generating 59% of the company’s operating income on just 21% of sales while recording triple-digit growth in its custom AI chip segment with new OpenAI and Anthropic contracts. Amazon joined Google, Microsoft and Meta in the $130.6 billion Q1 AI spend, targeting $700 billion by year-end and weighing a $20 billion chip spin-off.
1. AWS Q1 2026 Results
Amazon Web Services grew revenue 28% in Q1 2026, generating 59% of the company’s operating income on just 21% of total sales. AWS also reported triple-digit growth in its custom AI chip business, securing major AI customers including OpenAI and Anthropic.
2. AI Investment Scale and Costs
Amazon contributed to the $130.6 billion AI investment by Big Tech in the first quarter, part of an anticipated $700 billion spend by year-end across leading technology firms. Rapid increases in memory chip prices and other AI infrastructure components have driven higher capital expenditure forecasts.
3. Potential Chip Business Spin-Off
The company is evaluating a standalone chip division leveraging its Graviton and Trainium processors, which currently power a $20 billion annual internal run rate. If offered to external customers, the unit could target up to $50 billion in revenue once sufficient production capacity is established.