Amazon sees bigger AWS growth amid rising competition pressure

Amazon just posted the kind of quarter that makes competitors quietly update their strategy decks. AWS, the company’s cloud computing division, pulled in $42.2 billion in Q2 2026 revenue, a 37% jump from the same period a year ago. That’s the fastest growth rate the segment has posted in 18 quarters, or roughly four and a half years. Analysts had penciled in something closer to 31% growth, with consensus estimates around $40.5 billion in revenue. AWS beat that by a comfortable margin, turning what was already an optimistic outlook into a number that reframes the competitive dynamics of the entire cloud industry. The numbers behind the surge AWS is now running at a $169 billion annualized revenue rate. CEO Andy Jassy pointed out that if AWS were a standalone company, it would rank among the top 25 in the US by revenue. Operating income for the segment climbed 64% to $16.6 billion, with margins reaching 39.4%. AWS now accounts for more than 60% of Amazon’s total operating income, making it not just the growth engine but the profit engine of the entire company. Amazon’s overall Q2 net sales hit $200.6 billion, up 20% year-over-year. Total operating income rose 43% to $27.5 billion. Th...