Amazon’s relentless push into artificial intelligence is reshaping the tech landscape, and the numbers from its latest earnings tell a story of unbridled ambition. In the third quarter of 2025, the e-commerce behemoth poured a staggering $28.3 billion into capital expenditures, a 97 percent surge from the same period last year and a clear signal of its bet on cloud computing as the engine of future growth. This record outlay, heavily skewed toward Amazon Web Services infrastructure, underscores a broader AI arms race among Big Tech where billions are no longer the exception but the baseline for staying ahead.
The spending blitz powered AWS to its strongest quarter since 2022, with revenue climbing 20 percent to $33 billion and capturing a larger slice of the $107 billion global cloud market, up 27 percent year-over-year. AWS now accounts for over 60 percent of Amazon’s operating income, a testament to its high-margin prowess amid e-commerce’s slimmer returns. CEO Andy Jassy highlighted the momentum during the earnings call, crediting investments in custom silicon like Trainium and Inferentia chips for enabling faster, cheaper AI workloads that attract enterprise clients from startups to Fortune 500 giants.
This capex surge isn’t isolated—it’s part of a $125 billion full-year projection for 2025, more than doubling 2024’s $83 billion and setting the stage for even steeper climbs in 2026. Much of the Q3 haul funded data center expansions, including the recent $11 billion Project Rainier supercluster in Indiana and a $5 billion commitment to South Korean facilities. These moves bolster AWS’s capacity to handle exploding demand for generative AI tools, where customers are training models on vast datasets and deploying them at scale. Analysts point to early wins: AWS’s Bedrock platform, which simplifies access to foundation models from partners like Anthropic and Stability AI, saw triple-digit growth in usage, helping Amazon claw back share from Microsoft Azure and Google Cloud.
The financial ripple effects were immediate. Amazon’s stock rocketed 14 percent in after-hours trading post-earnings, adding $330 billion to its market cap in a single session and outpacing laggard peers in the Magnificent Seven. Total Q3 revenue hit $180.2 billion, a 13 percent increase driven by 11 percent North American sales growth to $106.3 billion and 14 percent international gains to $40.9 billion. Operating income soared to $21 billion, fueled by AWS’s efficiency gains and advertising revenue that topped $14 billion. Looking ahead, Amazon forecasts Q4 sales between $206 billion and $213 billion, with operating profits of $21 billion to $26 billion, tempering expectations amid holiday volatility and geopolitical headwinds.
Yet this dominance comes with risks. The capex frenzy—mirroring Microsoft’s $35 billion Q3 spend and Alphabet’s $24 billion—raises questions about return timelines in a market where AI hype outpaces proven monetization. CFO Brian Olsavsky acknowledged the pressure, noting that while Q2’s $31.4 billion rate was “reasonably representative,” Q3’s escalation reflects “very high demand for additional compute.” Critics worry about overbuilds if AI adoption slows, but Jassy counters that underinvestment would cede ground to rivals. Amazon’s strategy leans on diversification: beyond cloud, it’s expanding same-day grocery delivery to 2,300 U.S. cities by year-end and launching Future Ready 2030, a $2.5 billion upskilling initiative for 50 million workers in AI-adjacent fields.
For investors and innovators alike, Amazon’s Q3 capex milestone signals more than fiscal firepower—it’s a blueprint for AI supremacy. As hyperscalers like Meta ramp to $116 billion in 2026 infrastructure costs, the cloud wars are entering a phase where scale begets scale. Amazon, with its early-mover edge in hyperscale data centers, isn’t just fueling dominance—it’s architecting the infrastructure that will power the next decade of intelligence. In a world where AI isn’t optional, this $28 billion quarter might just be the spark that keeps Amazon’s empire glowing brightest.
