Amazon Joins $3 Trillion Club as AI Demand Powers AWS to Fastest Growth in Four Years

Amazon enters $3 trillion club as AI optimism sweeps through Wall Street

Aug 3 (Reuters) - Amazon touched a $3 trillion market capitalization for the first time on Monday, joining a handful of ⁠Wall Street giants at the top as a wave of renewed artificial intelligence optimism lifted technology stocks ⁠to new highs. Its shares (AMZN.O), opens new tab were last up 3.1% at $279, ⁠hitting a record high and taking ⁠its yearly gains to ⁠17.5%. Reporting by Shashwat Chauhan and Purvi Agarwal in Bengaluru Our Standards: The Thomson Reuters Trust Principles., opens new tab

Amazon joins the $3 trillion club as AWS chief calls the AI business 'just massive'

Amazon has joined the $3 trillion club. The company's market value crossed the mark for the first time on Monday, making it the fifth listed company to get there, after a rally driven almost entirely by artificial intelligence. The shares hit a record $287.16 and rose around 4% on the day, their best session since early May and up more than 23% this year. It has taken Amazon a little over two years to add its third trillion, having reached $2tn in June 2024. The catalyst was cloud. Amazon's recent quarter, in which AWS growth soothed fears about its AI spending, drove the stock up and kept it climbing into this week. AWS is now running at an annualised $169bn, after growing 37% in the quarter, its fastest pace in more than four years. Group revenue topped $200bn for the first time, and the demand behind it is generative-AI training and deployment. The executive in charge is not playing it down. Matt Garman, who runs AWS, told Bloomberg that the potential AI business is 'just massive', the kind of line that reads as confidence when the capacity to back it is being poured in real time. That building is expensive. Chief executive Andy Jassy has lifted Amazon's planned capital spending to about $220bn for the year, up from an earlier $200bn, with almost all of the increase going into AI data centres and chips. The chips are increasingly Amazon's own. Its custom Trainium and Graviton processors now sit on a combined run rate above $25bn, and Jassy has said the chip business could be worth $50bn, a hedge against leaning on Nvidia. The spending is part of a much larger wave. Big Tech is now carrying nearly $2.4 trillion in commitments tied to AI, and Amazon's raised budget is one line in a bill the whole industry is running up. Demand has been outrunning supply. Amazon has said its computing capacity was not enough to serve customers even after it raised spending, an unusually blunt admission that the constraint is physical rather than commercial. The result also resets the cloud scoreboard. AWS had been growing more slowly than Microsoft's Azure and Google Cloud for stretches of the AI boom, so a 37% quarter is Amazon's answer that it has not surrendered the lead it built. Profitability is the quieter part of the story. AWS margins widened even as spending climbed, a sign the AI workloads are landing on infrastructure Amazon can run at scale rather than bleeding cash. Wall Street has cheered rather than flinched. Morgan Stanley and JPMorgan both raised their price targets, reading the AWS acceleration as evidence that the AI spending is turning into revenue rather than staying a cost. That is the fear the quarter answered. For much of the year, investors worried that the hyperscalers were spending on AI faster than it could pay back, and AWS's reacceleration is the clearest counter yet. Amazon is spending on people as well as silicon. It has put $1bn into forward-deployed engineers to embed AWS staff inside enterprise customers, a bet that winning AI workloads is as much about hand-holding as horsepower. The company keeps elevated company. The $3tn club now holds Apple, Microsoft, Alphabet, Nvidia, and Amazon, with Nvidia out in front near $5tn, a roster that reads as a list of who is selling the AI boom its infrastructure. The risk sits on the far side of the same trade. If AI demand cools or the payback slows, the capital already committed becomes a weight rather than a lever, which is why every quarter of AWS growth now carries outsized weight. The milestone is a number, and numbers can retrace. But for a company that spent the year defending its AI bill, crossing $3tn on the strength of that same spending is the market's way of saying it now believes the story.

Amazon surpasses $3trn market valuation for the first time

Tech giants Apple, Microsoft, Alphabet and Nvidia are the other four companies to have previously recorded a market value of $3trn. Amazon became the fifth company ever to see its market value surpass the $3trn mark when its shares rose by about 5pc yesterday (3 August). Tech giants Apple, Microsoft, Alphabet and Nvidia are the other companies to have previously recorded a market value of $3trn. Amazon hit the milestone having first reached the $2trn market capitalisation mark in June 2024. It first reached the $1trn value benchmark in late 2018. Last Thursday (30 July), the e-commerce and cloud computing giant published its results for the second fiscal quarter of 2026, with net sales increasing 20pc year-on-year to more than $200bn. Its operating income was up 43pc to $27.5bn, while sales at its AWS cloud infrastructure division increased 37pc year-over-year to $42.2bn, its fastest growth in 18 quarters. Amazon president and CEO Andy Jassy said that "AWS is booming", adding that "our AI and chips businesses each eclipsed run rates of more than $25bn", which the company said amounts to "triple-digit percentages" growth year-on-year. AI-driven demand for cloud and chips solutions contributed to AWS surpassing analysts' forecasts for the quarter ending 30 June, causing the recent jump in Amazon share prices. Jassy told investors on a conference call following the release of the earnings report that the company now projected capital expenditures for 2026 hit $220bn, up from the $200bn estimate it made in February and reaffirmed in April. "But even at that amount, we will still not have enough capacity to meet all the demand we have in 2026, and I believe this dynamic will also be true in 2027 too," Jassy said. "In fact, the demand we already have for 2028 is striking." Infrastructure spending and "investments in artificial intelligence" caused Amazon's free cash status to see an outflow of $7.6bn for the preceding 12 months, the company said. This compares to a free cash flow inflow of $18.2bn for the 12-month period ended 30 June 2025. Amazon has a 2GW deal with OpenAI for its Trainium capacity through AWS, as well as a 5GW deal for the same with Anthropic. The company is also investing $25bn into Anthropic. AWS also has collaborations with up-and-coming Nvidia rival Cerebras; with Uber, for its Graviton and Trainium chips; and with Meta, to deploy tens of millions of AWS Graviton cores for its AI workflows. Amazon is offsetting some of its AI expenses with large-scale layoffs at the company. In January, it cut about 16,000 jobs, which followed about 14,000 job cuts last October. Around 450 Irish jobs are understood to have been affected in this move. Meanwhile, AWS could be set for a 'gatekeeper' designation in the EU due to the strength and prevalence of its market position as the largest cloud computing services provider in Europe. Don't miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic's digest of need-to-know sci-tech news.

What bubble? Amazon enters $3 trillion market cap club, CEO highlights striking AI demand

Amazon shares reached a new high, briefly surpassing $3 trillion in market value. This surge followed a strong earnings report and increased investor confidence in artificial intelligence. The company's cloud services showed significant growth, exceeding expectations and boosting its valuation. Amazon anticipates substantial capital expenditures to meet future artificial intelligence demand. Other tech giants like Apple and Microsoft also saw their market values increase. Amazon shares soared to a fresh lifetime high on Monday, briefly pushing its market cap above the $3 trillion mark for the first time ever after the company's better-than-expected earnings report last week boosted investor sentiment on the back of strong AI demand. Shares of Amazon jumped more than 4% on Monday, recording its best-ever day since early May this year. This came after the company delivered its strongest cloud growth in over four years and raised its annual capital spending forecast. US MarketsPowered By As on 04 Aug 2026, 01:30 AM IST S&P 500 Top Gainers First Solar232.73(10.28%) Oracle141.85(9.22%) Axon Enterprise575.88(9.12%) Builders FirstSource72.48(9.09%) Gainers" S&P 500 Top Losers Coterra Energy32.56(-8.62%) Marriott International346.83(-6.97%) Fair Isaac1,045(-6.90%) eBay107.13(-6.03%) Losers" Which other companies belong to the $3 trillion m-cap club? Tech giants Apple, Microsoft, Alphabet and Nvidia are the other companies that have recorded a market value of $3 trillion. Nvidia is currently the world's biggest company with a market capitalization close to $5 trillion. Amazon, founded by Jeff Bezos back in 1994, took a little over two years to add another trillion dollars to its market value after hitting a $2 trillion valuation for the first time in June 2024. Amazon now estimates its capital expenditures to hit $220 billion this year, up from $200 billion that it had projected in February, with CEO Andy Jassy noting that memory prices linked to the AU buildout are continuing to rise. Its revenue of around $201 billion beat analysts estimates of near $196 billion, as per a CNBC report. What Amazon CEO said about AI demand "But even at that amount, we will still not have enough capacity to meet all the demand we have in 2026, and I believe this dynamic will also be true in 2027 too...In fact, the demand we already have for 2028 is striking," Jassy said said during a conference call with investors. Amazon Web Services (AWS) posted a revenue of $42.2 billion, flying past StreetAccount expectations of $40.54 billion, CNBC reported. Notably, this comes amid an overall caution over artificial intelligence. Also Read | Explained: Why Dow Jones closed at lifetime high despite caution over AI frenzy The AI seesaw Since last year, global stock markets saw an increasing frenzy around AI, with hyperscalers hiking their investments in the technology. The increased optimism sparked a sharp rally in the AI stocks, before things began to go down. Analysts soon began sounding the alarm over the massive AI spending and rising debt of the tech giants, questioning if they will actually bear fruit in the future. The worries sparked a sharp selloff in the tech stocks. South Korea's Kospi, which was seen as the face of the AI frenzy, massively crashed as a result. However, the latest round of strong earnings by Wall Street's tech giants and positive commentary around AI demand may have relieved some concerns. Shares of other hyperscalers also jumped on Monday. Microsoft shares rose 4%, Meta Platforms rallied 6% while Alphabet and Oracle shares rose 4-5%. Microsoft last week said that it expects to remain cash-generative through the fiscal 2027, and forecast capital spending below Wall Street estimates, helping drive its biggest one-day share gain since 2008. Also Read | Peter Lynch does not like the AI trade; here's why he says 'Know what you own' (With inputs from agencies) (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

Amazon joins $3 trillion club as AI, cloud growth fuel stock rally

Amazon crossed a $3 trillion market valuation after strong earnings and robust cloud growth reinforced confidence in its AI investments. Shares hit a record high, while investors rewarded the company for demonstrating improving returns from heavy AI infrastructure spending. Amazon's market capitalisation surpassed $3 trillion for the first time on Monday as its shares rallied following strong earnings and signs that the AI boom is fueling demand for its highly profitable cloud-computing business. The stock climbed 5.5% to a record $286.20, extending its year-to-date gain to more than 23%. US MarketsPowered By As on 03 Aug 2026, 08:31 PM IST S&P 500 Top Gainers First Solar240.04(13.75%) Builders FirstSource71.54(7.67%) United Airlines Holdings129.43(6.68%) Axon Enterprise562.42(6.57%) Gainers" S&P 500 Top Losers Coterra Energy32.56(-8.62%) Fair Isaac1,048(-6.64%) Marriott International348.44(-6.54%) Monolithic Power Systems1,344(-5.77%) Losers" Shares of the Seattle-based e-commerce and cloud-computing giant jumped 15% on Friday after posting its strongest cloud growth in more than four years and lifting its annual capital-spending forecast. Among the six "Magnificent Seven" companies that have reported so far, only Amazon and Microsoft have convinced investors that their AI investments are paying off. Tesla, Alphabet and Meta, meanwhile, faced a backlash after their heavy spending weighed on free cash flow last quarter. Like other Wall Street tech giants, Amazon has invested billions of dollars in expanding its AI infrastructure. In April, it disclosed a new investment in Anthropic, following an earlier pledge to invest up to $50 billion in OpenAI. Founded by Jeff Bezos in 1994, Amazon added another $1 trillion to its market value in just over two years after first reaching a $2 trillion valuation in June 2024. Apple, Microsoft, Alphabet, and Nvidia are other companies that have reached a market value of $3 trillion in the past. Nvidia is currently the world's largest company by market capitalisation, at close to $5 trillion.

Amazon's AI Business Helps It Top $3 Trillion Market Cap | PYMNTS.com

The company's market value exceeded that figure for the first time Monday after Amazon reported earnings Thursday (July 30) that signaled that artificial intelligence continues to fuel demand for its cloud-computing offerings, the report said. Amazon and Microsoft are the only two of the Magnificent Seven companies that have reported earnings so far this quarter and gotten a positive reception from investors, according to the report. Google parent Alphabet, Meta and Tesla all saw their shares fall after reporting heavy AI spending. Apple and Nvidia make up the remainder of the Magnificent Seven. Apple reported earnings Thursday, and shares were down on weak revenue guidance. Nvidia will report earnings Aug. 26. Amazon and other tech giants have invested billions of dollars in expanding their AI infrastructure. Amazon is investing in Anthropic and last week completed a $50 billion investment in OpenAI. Other companies whose market value has reached $3 trillion include Alphabet, Apple, Microsoft and Nvidia, the report said. As of Monday morning, Nvidia is the world's largest company, with a market capitalization of nearly $5 trillion, a figure Apple also reached last week. Meanwhile, PYMNTS reported Thursday that "Amazon appears to be abandoning the most expensive and least defensible layer of the AI stack in order to strengthen the businesses where it already enjoys structural advantages: cloud computing, retail operations, advertising and logistics." Its goal seems to be winning the AI economy, and the move shows capital discipline. It also increases the stakes in Amazon's competition with Walmart, as the latter company applies AI to product search, supply chains, employee productivity and store operations without making a major play to become a frontier-model leader. The contrast points to the next phase of retail AI competition. "Amazon and Walmart are unlikely to win based on which company trains the most impressive general-purpose model," the report said. "They will win based on which company can connect increasingly available intelligence to proprietary commercial systems."