Overview
- In the first quarter, AWS revenue grew 28% year over year to $37.6 billion as AWS said AI-related revenue is running above a $15 billion annual rate.
- Amazon guided roughly $200 billion in capital spending for 2026 focused on AI data centers and chips and that buildout has driven free cash flow down sharply from 2024 levels.
- Since the quarter closed the company announced several large commercial commitments and moves, including a reported Anthropic commitment above $100 billion, a roughly $4 billion Pinterest AWS deal through 2031, and the planned purchase of Apple’s 20% Globalstar stake.
- At its Upfront Madrid event Amazon rolled out new ad formats and AI advertising tools, expanded streaming partnerships and introduced Creative Agent and Ads Agent for advertisers to target audiences across Prime Video and third-party inventory.
- Investors and analysts remain broadly bullish with most ratings at Buy and price targets implying upside, but the heavy, front-loaded capex raises near-term cash‑flow and execution risks that will determine whether the AI bet pays off.