Dive Brief:
- Amazon will invest $200 billion in capital expenditures throughout its fiscal year 2026, with a primary focus on AWS, CEO Andy Jassy said during the company’s Q4 2025 earnings call Thursday. AWS segment sales grew 24% year over year to $35.6 billion for the period ending Dec. 31, 2025.
- Increasing demand is driving Amazon’s expanded capital expenditures, Jassy said, adding that he anticipates “strong long-term return on invested capital.” The funds are also earmarked for chips, robotics and low Earth orbit satellites.
- “Customers really want AWS for core and AI workloads,” Jassy said. “We’re monetizing capacity as fast as we can install it.”
Dive Insight:
Amazon, Google and Microsoft combined expect to invest more than $500 billion in capital expenditures in 2026 as the tech giants race to build out AI infrastructure.
Microsoft is on track to double its capital expenditures in fiscal year 2026, which have reached $72.5 billion in the first two quarters. The number falls just shy of the company’s $80 billion total capital spend for the full 2025 fiscal year.
Meanwhile, Google’s parent company Alphabet projected capital expenditures totaling up to $185 billion in its 2026 fiscal year. Alphabet CEO Sundar Pichai said the company is ramping up capacity and “planning for the long term” during Alphabet’s Q4 2025 earnings call Wednesday.
As cloud providers build it, enterprises are buying it.
Enterprise spend on cloud infrastructure services totaled $419 billion in 2025, according to data from Synergy Research Group published Thursday. Enterprise spend rose $29 billion from Q4 2024 to Q4 2025, the scale of which “far surpasses anything previously seen in this market,” according to Synergy.
Amazon maintains the market share lead among major cloud providers with a 28% slice of the market, followed by Microsoft at 21% and Google at 14%, the firm found. Neocloud provider CoreWeave has also joined the top 10 cloud providers, generating more than $1.5 billion in quarterly cloud revenue.
For Amazon, 2026 is going to be a significant year, said Futurum Group CEO Daniel Newman. The company’s total net sales increased 12% to $716.9 billion for the 2025 fiscal year.
“The narrative that AWS was slow off the blocks on AI has faded,” Newman said in an email to CIO Dive.
While AWS saw its fastest quarterly growth since 2022 and Amazon’s Trainium and Inferentia chips gained traction — reducing AI model developer dependency on Nvidia — robotics and physical AI stand to be the company’s next big boon, Newman said.
“Amazon has already built the infrastructure — advanced distribution centers, robotic fulfillment, autonomous delivery,” Newman said. “They’re positioned to take costs out of the system while competitors are still building.”
