Investors love AI, as long as you’re a cloud host
TechCrunch AI Russell Brandom ● Covered by 4 sources
Amazon reported strong Q2 earnings with 20% net sales growth and 37% AWS cloud revenue growth, leading its stock to rise nearly 10% despite the company increasing capex spending to $220 billion for 2026. The company spent $173 billion on property and equipment in fiscal 2024, up from $107.65 billion the prior year, while also investing in custom chips like Trainium and Graviton to improve cloud margins. Investors are backing cloud providers with strong revenue streams like Amazon and Microsoft, while remaining skeptical of AI labs and startups without clear revenue sources, though this confidence may be fragile if underlying AI demand doesn't sustain the massive infrastructure buildout.
Why it matters
Amazon isn't slowing down on data center spending — but investors don't seem to mind.
