Amazon: Revenues at $181.5 Billion, AWS Accelerates but Competition is Fierce
Amazon closed the first quarter of 2026 with results above expectations across all major indicators. Total revenues reached $181.52 billion (+17% year-over-year), with operating income at $23.9 billion (up from $18.4 billion last year) and net income at $30.3 billion, a sharp increase from $17.1 billion in Q1 2025.
The cloud segment was the most significant highlight of the earnings report. Amazon Web Services (AWS) generated revenues of $37.59 billion, growing by 28% compared to the same period last year, when it stood at $29.27 billion. Wall Street had anticipated a growth of 26%. This represents the highest expansion rate recorded by AWS in the last three years.
The operating income for the segment rose by 23% to $14.16 billion, exceeding consensus estimates set at $12.84 billion. AWS now accounts for nearly 21% of the group's total revenues. However, competition in the sector is fierce. During the same period, Microsoft reported a 40% growth for Azure and other cloud services, while Alphabet reported a 63% increase for Google Cloud. Despite Amazon maintaining its market leadership in cloud infrastructure, the percentage gap compared to its two main competitors has widened.
AWS's growth is closely linked to its AI strategy. During the quarter, OpenAI announced the expansion of its existing $38 billion commitment on AWS, adding another $100 billion distributed over eight years, with Amazon planning to invest $50 billion in OpenAI. At the same time, Amazon signed an agreement to invest up to $25 billion additional in Anthropic, on top of the $8 billion already allocated in previous years, to finance the development of AI infrastructure. Earlier this week, OpenAI also announced that Microsoft will lose its status as the sole cloud provider for certain types of computational work; the next day, AWS made OpenAI's models available through Amazon Bedrock, the cloud service dedicated to building AI-based agents and applications.
CEO Andy Jassy emphasized the role of Amazon's proprietary chips as an enabling factor in the AI ecosystem, citing the segment as one of the highlights of the quarterly report. The volume of investments related to AI is directly reflected in the structural financial metrics. Capital expenditures in the first quarter reached $44.2 billion, but Amazon has already projected Capex of around $200 billion for 2026, a significant increase compared to the previous year.
Not only data centers, the investments will also push the satellite constellation Project Kuiper – Amazon Leo. CFO Brian Olsavsky confirmed that Amazon aims to launch commercial service by the third quarter. The constellation is expected to include 7,700 satellites in total, but currently about 270 are operational. Earlier this month, Amazon announced the acquisition of Globalstar for approximately $11.57 billion.
The online sales segment, still the largest in terms of share of total revenues, recorded a growth of 12% to $64.3 billion, surpassing estimates of $62.7 billion. The advertising division marked a 24% year-on-year increase to $17.24 billion, beating growth expectations of 21.2%. The advertising sector is primarily fueled by sponsored ads on the e-commerce platform and is considered one of the units with the highest margins in the entire group.
For the second quarter of 2026, Amazon forecasts revenues between $194 and $199 billion, compared to consensus estimates of $188.9 billion. Operating income is expected to be between $20 and $24 billion.
On the employment front, the workforce decreased by about 1,000 compared to the fourth quarter, settling at 1.57 million employees globally. This figure follows the layoffs of 16,000 corporate positions announced at the beginning of the quarter and 14,000 cuts made in October.