Markets AMZN JUL 31, 2026

AWS grows 37% to $42.2B, Amazon adds $400B in market cap as hyperscaler 2026 capex hits $745B

AMZN surged its most since 2012 after AWS printed its fastest growth since Q4 2021, easing investor fears that a $720B–$745B AI spending spree lacks a return.

BY HENLEY MARRAST · MARKETS DESK

AWS grew 37% in the second quarter to $42.2 billion in revenue, its fastest expansion since Q4 2021 and its fifth straight quarter of accelerating cloud sales. Amazon shares jumped more than 10% in extended trading Thursday and closed Friday with the stock’s biggest single-day gain since 2012, adding roughly $400 billion in market value across the week. Wall Street had modeled 31%. StreetAccount had penciled AWS at $40.54 billion. The beat was more than $1.6 billion wide.

The number matters because of what surrounds it. Four hyperscalers have collectively guided investors to between $720 billion and $745 billion in 2026 capital projects, and until this week the market wasn’t sure the revenue line was keeping pace with the concrete pour. Amazon’s own capex hit $54.21 billion in Q2, up 68% year over year, with management flagging elevated spending running into 2028 and full-year 2026 guidance of $220 billion.

Bernstein’s Mark Shmulik said AWS had “hit a growth inflection.” Analysts pointed to AI revenue climbing to 15% of total AWS revenue, alongside Trainium chip improvements and demand for Bedrock.

The read-through was immediate. Alphabet’s Google Cloud grew 82% the prior week; Microsoft Azure grew 43% in its fiscal fourth quarter. Microsoft added more than $600 billion in market cap this week, with Amazon and Alphabet each adding over $400 billion, nearly $1.5 trillion combined. The Nasdaq, which the day before sat 9.8% below its record, rallied 2.8% Thursday. Bank of America raised its Amazon price target to $320 from $310, implying 36% upside from Thursday’s close.

Group revenue came in at $200.61 billion against a $196.47 billion consensus, with adjusted EPS of $1.97 versus $1.82 expected. Q3 guidance of $197 billion to $202 billion sits below LSEG’s $204.1 billion, which CEO Andy Jassy’s team attributed to Prime Day shifting into June.

What changed this week isn’t the spending. It’s the willingness to underwrite it. The doom-loop narrative around AI capex, that hyperscalers were building supply for demand that hadn’t shown up, needed one clean print to break. It got three.

Sources

About the author

Henley Marrast

MARKETS DESK

Henley Marrast covers AI-equity flow, accelerator demand, and earnings prints for AI Sheet Report. She leads coverage of the public AI complex from the New York markets desk, with a focus on the daily tape and quarterly results. She has been writing about technology markets for several years.