Amazon stock jumps 9% as AWS growth accelerates to 37%, its fastest since 2021

Amazon shares jumped more than 9% in after-hours trading on July 30 after the company posted second-quarter 2026 results that beat Wall Street estimates across every major segment, with AWS revenue growth accelerating to 37% year-over-year — its fastest pace since 2021.

AWS breaks out

Amazon Web Services generated $42.2 billion in revenue, ahead of the $40.54 billion analysts expected, and grew 37% year-over-year — well past Wall Street's 31% growth forecast heading into the print. CEO Andy Jassy called the unit "booming" in the earnings release, highlighting that both AWS's AI products and its in-house chip lines — Trainium and Graviton — individually exceeded $25 billion in annualized revenue, more than doubling from a year earlier.

The acceleration matters in context: heading into this report, investors were watching AWS growth closely after rival clouds posted strong numbers of their own — Google Cloud grew 82% last week and Microsoft's Azure grew 43% in its most recent quarter. AWS's 37% is still the slowest of the three hyperscalers by that measure, but the acceleration from prior quarters, combined with the AI and chips business both crossing $25 billion run-rate, is what moved the stock, not the headline growth number in isolation.

Beats everywhere else too

Total revenue reached $200.6 billion against a $196.47 billion estimate, and advertising revenue hit $19.81 billion versus $19.43 billion expected. Earnings per share came in at $5.75, well above the $1.82 analysts had modeled — though that figure reflects a one-time item rather than a clean operating beat of that scale, and investors focused more on the revenue and AWS numbers than the raw EPS print.

The spending side of the story

The results also underline how much Amazon is now spending to sustain that growth. Capital expenditures reached $54.2 billion for the quarter, up from $32.1 billion a year earlier — a jump of roughly 69%. That spending has pushed Amazon's trailing-twelve-month free cash flow into negative territory, an outflow of $7.6 billion, compared to an $18.2 billion inflow in the same period a year ago. For a company that has spent two decades emphasizing free cash flow as its core financial metric, a negative reading — even one clearly explained by AI infrastructure investment — is a notable shift.

Guidance for the current quarter came in slightly below expectations: Amazon projected revenue between $197 billion and $202 billion, versus the $204.1 billion analysts had modeled, a gap the company attributed partly to tough year-over-year comparisons after shifting this year's Prime Day event earlier in the calendar.

What it signals for the AI infrastructure cycle

Amazon's results arrive in the same week as Microsoft's Azure milestone and Samsung's record chip profits — three separate data points all pointing the same direction: AI infrastructure demand is still accelerating, not plateauing, even as the capital being poured into it reaches levels that are starting to visibly strain traditional financial metrics like free cash flow. Whether that trade-off remains acceptable to investors depends on whether AWS, Azure, and Google Cloud's accelerating growth rates continue to justify the spending, or whether the market's patience runs out first. Results were confirmed via CNBC's earnings coverage.