Amazon Web Services (AWS), Amazon’s cloud infrastructure service, is on track to post its strongest growth in three years, driven by the AI industry’s unprecedented demand for computing power.
Amazon said in its third-quarter earnings call Thursday that AWS grew 20% year-over-year, ending the quarter with $33.1 billion in revenue for the first nine months of the year. The segment’s operating income increased to $11.4 billion in the third quarter, up from $10.4 billion at the same point in 2024.
“AWS is growing at a pace not seen since 2022, reaccelerating to 20.2% year-over-year,” Amazon President and CEO Andy Jassy said in an earnings call. “Demand for AI and core infrastructure remains strong and we are focused on accelerating capacity, adding more than 3.8 gigawatts in the past 12 months.”
AWS launched an infrastructure region in New Zealand during the quarter, with three more regions in development.
The cloud infrastructure provider also won several new deals across a variety of industries in the third quarter, including several prominent players in the AI market. In July, AWS partnered with Perplexity to launch the AI browser company’s enterprise offering. AWS also partnered with Cursor during the third quarter.
AI’s demanding demands on infrastructure are also a boon for AWS competitors. OpenAI and Oracle reportedly signed a massive $300 billion cloud computing deal in September starting in 2027. The companies also struck a deal in which OpenAI will pay Oracle $30 billion annually for data center services. Last week, Google and Anthropic announced a cloud deal worth tens of billions of dollars.
These huge deals have come despite skepticism about how much cloud infrastructure will actually be needed in the future and whether the industry is entering bubble territory. But it makes sense for cloud companies like AWS to take advantage of a market where customers pay top dollar for their services.
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Regarding investments in AI infrastructure, Jassy said, “We’re going to continue to be very aggressive in investing in capabilities because we know there’s a demand.” “Now, as quickly as we add capacity, we are monetizing it.”
The news comes two days after Amazon announced it would cut 14,000 corporate jobs as it looks to further invest in its AI strategy.
