Amazon Web Services sales climb 28 percent to $37.6 billion as AI demand drives fastest growth in 15 quarters

Amazon Web Services posted net sales of $37.6 billion in the first quarter, a 28 percent year-over-year increase that CEO Andy Jassy called the fastest growth rate for the cloud unit in 15 quarters. Jassy attributed the surge to AWS’s role in supplying compute to the AI industry. He noted that the unit’s AI revenue run rate is now over $15 billion, compared with a $58 million run rate three years after AWS launched in the mid-2000s. The rapid expansion, however, has required heavy capital investment that is straining free cash flow. Amazon’s free cash flow for the trailing twelve months fell to $1.2 billion, down 95 percent from the $25.9 billion recorded in the first quarter of 2025. The decline was driven primarily by a year-over-year increase of $59.3 billion in property and equipment purchases tied to AI infrastructure. Jassy framed the spending as a short-term cash outlay for long-lived assets, noting that data centers last more than 30 years while chips, servers, and networking gear have five-to-six-year useful lives. He told investors that “in times of very high growth like now. where the capex growth meaningfully outpaces the revenue growth. the early years, free cash flow is challenged.” The company said it has been through a similar cycle during AWS’s first major growth wave and expects comparable results this time, with larger potential revenue and free cash flow down the line. Overall, Amazon sales rose 17 percent to $181.5 billion. North America revenue grew 12 percent, and international revenue increased 19 percent.