AWS exceeds Wall Street’s expectations as demand for cloud infra remains high

Core Insights - Amazon Web Services (AWS) is set to achieve its strongest growth in three years, driven by unprecedented demand from the AI industry [1] Group 1: Financial Performance - AWS reported a 20% year-over-year growth, with sales reaching $33.1 billion in the first nine months of the year [2] - The operating income for AWS increased to $11.4 billion in Q3, up from $10.4 billion in the same quarter of 2024 [2] Group 2: Market Demand and Capacity Expansion - AWS is experiencing a re-acceleration in growth, with a year-over-year increase of 20.2%, attributed to strong demand in AI and core infrastructure [3] - The company has added over 3.8 gigawatts of capacity in the past 12 months and launched a new infrastructure region in New Zealand, with three more regions planned [3] Group 3: Strategic Partnerships - AWS secured several new deals in Q3, including partnerships with AI companies like Perplexity and Cursor [4] Group 4: Competitive Landscape - Competitors in the cloud infrastructure space, such as OpenAI and Oracle, have also engaged in significant deals, including a $300 billion cloud compute agreement starting in 2027 [5] - Despite skepticism about future cloud infrastructure needs, the current market allows cloud companies to capitalize on high customer demand [6] Group 5: Investment Strategy - AWS plans to aggressively invest in capacity to meet ongoing demand, with a focus on monetizing the added capacity [7] - This investment strategy comes alongside Amazon's decision to cut 14,000 corporate jobs to reallocate resources towards its AI initiatives [7]