Amazon’s ambition to compete in the AI arms race just got a major boost from its core business. The company’s cloud division, AWS, reported a 20% revenue jump to $33bn, its fastest growth since 2022, providing a massive cash flow for new investments.
This strong performance, which beat estimates, is crucial as Amazon’s stock has lagged behind AI-focused rivals. The earnings report, which also beat overall revenue and profit forecasts, helped Amazon’s stock climb 9%.
On the investor call, executives were keen to show off their AI progress. They highlighted the Rufus shopping assistant and the expansion of the Zoox autonomous driving service.
The strong AWS quarter is also the first financial report since a major global outage. The division’s ability to shrug off the incident and still beat estimates points to its deep entrenchment.
In a contradictory move, Amazon also confirmed 14,000 corporate layoffs. While the company’s blog suggested AI was a factor, CEO Andy Jassy insisted the cuts were a “culture” move to make the company “nimble.”