In the second quarter of 2024, Amazon Web Services (AWS) reported a 19% increase in revenue and a 72% rise in operating income. The company also announced plans to expand its investments in artificial intelligence (AI) related datacentre technologies. During the same period, parent company Amazon.com saw total revenue grow by 11% to $148bn, with a profit increase of 91% to $14.7bn.
AWS CEO Andy Jassy attributed the strong performance to increased interest from enterprises in cloud migration and infrastructure modernization projects. He highlighted the benefits of modernization, such as cost savings, faster innovation, and improved developer productivity. Jassy also noted a significant uptick in the adoption of AI services by businesses of all sizes, with AWS’s AI business showing substantial growth.
Despite a 2% decrease in operating margin, Amazon CFO Brian Olsavsky emphasized that fluctuations are normal due to ongoing investments in the business. He announced plans for increased capital spending in the second half of 2024 to support the growing demand for AI services. The company aims to enhance its datacentre infrastructure to meet the needs of generative AI and non-generative AI workloads.
AWS is not alone in its focus on AI investments, as Microsoft also revealed plans to allocate a significant portion of its capital expenditure to AI and cloud resources. This highlights the continued growth and importance of AI in the cloud computing industry.