AWS Revenue Climbs 28% to $37.6B While Capex Surge Sends Free Cash Flow 95% Lower
Amazon Web Services net sales rose 28% year-over-year to $37.6 billion in Q1, marking the fastest growth rate for the unit in 15 quarters. Capital expenditures surged by $59.3 billion, driving free cash flow down 95% to $1.2 billion over the trailing twelve months.
1. Strong AWS Growth
Amazon Web Services posted net sales of $37.6 billion in Q1, a 28% increase from the prior year and the highest quarterly growth rate it has achieved in 15 quarters. CEO Andy Jassy attributed the surge to AWS’s expanding role in supplying compute power for artificial intelligence workloads.
2. Surge in Capital Expenditure
Capital spending jumped by $59.3 billion over the trailing twelve months as AWS laid out cash for land, power, data centers, chips, servers and networking equipment to support future growth. Jassy noted that these assets, while a short-term cash outlay, provide infrastructure lasting decades.
3. Free Cash Flow Impact
The spike in infrastructure investment drove free cash flow down 95% to $1.2 billion over the past year, compared to $25.9 billion in the year-earlier period. Company leadership emphasized that this temporary cash burn reflects long-term payoff from AI-focused data center builds.