Amazon's AWS revenue jumps 28% while free cash flow collapses 95% in AI push

Amazon reported first‑quarter revenue of $181.5 billion, up 17% year over year, with North American sales rising 12% and international sales 19%. Its cloud division, Amazon Web Services (AWS), posted $37.6 billion in net revenue, a 28% increase and the fastest growth in 15 quarters, driven by soaring demand for AI computing power.

To meet that demand the company accelerated capital spending, investing $59.3 billion in data‑center land, power, chips, servers and networking equipment. The heavy outlay reduced free cash flow to $1.2 billion, a 95% decline from the $25.9 billion recorded a year earlier. CEO Andy Jassy described the strategy as “spending money now to reap benefits later,” noting that AWS’s AI‑related revenue has already exceeded $15 billion in its first three years, roughly 260 times its early‑stage earnings.

Amazon acknowledges the short‑term cash‑flow strain but expects the AI‑driven growth to generate larger revenues and cash returns over the longer term.