Amazon Web Services could become a $1 trillion annual business within five to ten years. That is the view of Amazon CEO Andy Jassy, speaking on the third-quarter earnings call, where he also said the cloud unit could grow 40% or more in 2027 or 2028.
The quarter backs his confidence. AWS revenue rose 39.3% year on year, to nearly $46 billion. According to one outlet, the company is on track to reach about $184 billion in revenue for the fiscal year, a figure reported by a single source.
AI demand drives the buildout
Jassy said Amazon installs a new AI accelerator "about every 14 seconds," and customers are taking them up almost as fast. He said the Bedrock AI service is already the fastest-growing multi-billion-dollar service in the company's history, and that core compute and storage revenue are growing at their fastest rates in several years.
He argued that AI workloads pull through core AWS demand, because reinforcement learning, post-training and tool use depend on core infrastructure. He also said AI services margins are "well ahead" of where core services were at a comparable stage.
The bill is large. Amazon expects $220 billion of capital expenditure in 2026 and has already spent $75.9 billion in the last quarter alone, mostly on AWS. In October, Jassy had already said that AWS capacity for 2027 was almost exhausted and that commitments are also being collected for 2028. Jassy called AI "the biggest transformation in our lifetime" and said the company can fund the plan.
The cloud outgrows the rest of Amazon
Overall revenue for the quarter was about $180.17 billion, with retail growing 6% on much thinner margins. Jassy also pointed to Prime Video as a significant, now profitable business. He said about 85% of global IT spend is still on premises, and that the shift to cloud is underway even for mainframes and storage networks. If the growth rates hold, Amazon could soon be described as a cloud company with a retail side business.
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