Amazon topped $200 billion in quarterly revenue for the first time and raised its 2025 capital expenditure (capex) forecast by 10% to $220 billion within five months. Amazon, which demonstrated the performance of its artificial intelligence (AI) business, together with Alphabet (Google's parent company), Microsoft (MS) and Meta, made up the four major hyperscalers (operators of ultra-large data centers) whose combined capital expenditure in the second quarter reached $165 billion, a 87.1% surge from the same period a year earlier.
On the 30th, Amazon said its second-quarter (April-June) revenue rose 20% from a year earlier to $200.61 billion (about 285 trillion won). The result beat the estimate compiled by the London Stock Exchange Group (LSEG) of $196.47 billion. Operating profit increased 43% to $27.46 billion, and earnings per share (EPS) came to $5.75, more than three times Wall Street's estimate of $1.82. Amazon rose about 10% in after-hours trading following the earnings announcement.
At the center of the strong results was Amazon Web Services (AWS). AWS is the business responsible for cloud and AI computing services and accounts for about 20% of total revenue. As corporate demand for cloud surged with the recent spread of AI, AWS's quarterly revenue rose 37% from a year earlier to $42.2 billion. Operating profit surged 64% from a year earlier to $16.621 billion. AWS extended its growth to a fifth consecutive quarter, with analysts saying the AI boom is being reflected in its results.
On the back of this growth, Amazon plans to further increase its investment this year. This means it will expand investment in infrastructure, including memory chips, to respond to surging AI demand. Amazon Chief Executive Officer (CEO) Andy Jassy said, "In a few years, revenue growth will outpace capital expenditure growth." Amazon's second-quarter investment alone totaled $54.2 billion, exceeding Google ($44.9 billion), MS ($35.8 billion) and Meta ($30.1 billion).
According to the Financial Times (FT), the four companies' cumulative capital expenditure from early 2023, when the AI investment race began in earnest, through this quarter has reached $1.1 trillion. Combining the investment plans presented by each company, annual investment is projected to reach up to $745 billion.
Apple, which faced supply shortages as chip demand from Big Tech exploded, drew concern despite strong results. In its fiscal 2026 third-quarter (April-June) earnings announcement, Apple said revenue was $109.42 billion, beating LSEG's estimate of $108.65 billion. However, on its conference call it projected total fourth-quarter revenue would rise 9% to 11% from a year earlier, falling short of the market expectation of 12.1%. This is because memory price increases and supply shortages will constrain growth in electronic devices such as the iPhone and Mac.
Rishi Jaluria, an analyst at RBC Capital, noted, "There is practically no sign that the increase in capital expenditure is ending," adding, "Investors want a balance that continues AI investment while not undermining the profitability of existing businesses."
