Amazon reported third-quarter operating income of $28.1 billion, up 61%, and confirmed plans to spend close to $220 billion this year building out artificial intelligence infrastructure. Net sales rose 12% to $201.9 billion, the company said Thursday.
Cloud unit Amazon Web Services, which absorbs most of that spending, grew revenue 39% to $46 billion, its fastest pace in nearly five years. The division's order backlog reached $578 billion and is expanding at a triple-digit rate from a year earlier, the company said.
Chief executive Andy Jassy said AWS could grow more than 40% in both 2027 and 2028 and become a trillion-dollar-a-year business within five to 10 years. “AWS can grow north of 40 percent in each 2027 and in 2028, and be a trillion-dollar revenue business in the next five to 10 years,” he said.
Amazon's capital expenditure totaled $75.9 billion for the quarter, primarily for AWS and AI infrastructure. The cloud unit's operating margin came to 38.7%, while Amazon's companywide margin rose to a record 13.9%.
Amazon shares fell 6% in after-hours trading Thursday following the results. They closed Friday's regular session at $243.79, down 4.25% from the prior close.
Alphabet reported AI capital spending of $51.4 billion on Oct. 28, after which its shares dropped 9.4%.
