The numbers that matter
AWS revenue hit $35.6 billion in Q4 2025, up 24% year-over-year and beating analyst estimates of $34.9 billion. That's a $142 billion annual run rate and the fastest quarterly growth since Q3 2022. Operating income climbed to $12.5 billion from $10.6 billion a year earlier.
For enterprise tech leaders sizing up cloud commitments: AWS just extended its lead over Microsoft Azure and Google Cloud in absolute terms. CEO Andy Jassy made the point bluntly on the earnings call: "It's very different having 24% year-over-year growth on $142 billion annualized run rate than to have a higher percentage growth on a meaningfully smaller base."
What's driving it
AI workloads, primarily. Q4 saw new enterprise deals with Salesforce, BlackRock, Perplexity, and the U.S. Air Force. AWS added over a gigawatt of data center power capacity in the quarter alone. Jassy noted AWS still serves "more of the top 500 U.S. startups" than the next two providers combined.
For CTOs evaluating cloud economics: the AI boom is real, but it's creating capacity constraints. AWS is betting heavily on custom silicon (Trainium for training, Inferentia for inference) to offer cost advantages over GPU-only workloads. Worth watching if you're running ML training or SageMaker endpoints at scale.
The $200 billion question
Here's why the stock dropped 10% despite the beat: Amazon announced $200 billion in 2026 capital expenditure, up from $125 billion in 2025 and $53 billion above Wall Street's $147 billion consensus. That's for AI infrastructure, robotics, semiconductors, and satellites.
The trade-off: aggressive buildout positions AWS against rivals but pressures near-term margins. Amazon's overall earnings missed at $1.95 per share versus $1.97 expected. For enterprise buyers, this signals AWS will keep expanding capacity aggressively, but procurement teams should negotiate hard on reserved instances and savings plans given the pressure Amazon faces to monetize this spend.
What this means in practice
If you're planning multi-year cloud commitments, AWS's infrastructure investment creates leverage for enterprise customers willing to commit to reserved capacity. The AI capacity crunch is real, but so is Amazon's need to fill $200 billion worth of new infrastructure. The pricing conversation just got more interesting.