Stocks
Amazon's Jassy says AWS capacity is largely sold out through 2027, with a good part of 2028 already committed
The Amazon chief executive said AI demand is outrunning supply and the company could spend beyond its roughly $220 billion 2026 capex plan, six days before third-quarter results.
HedgeWeekly News Desk ·
Amazon Web Services has committed most of its cloud computing capacity through 2027 and has already booked significant volumes for 2028, chief executive Andy Jassy said on Friday in a video podcast hosted by Andreessen Horowitz's Ben Horowitz and Erik Torenberg, according to Reuters.
Jassy said capacity for 2026 is effectively sold out and that AI laboratories and enterprise customers are driving the demand, Reuters and Finimize reported. AWS still holds back some compute for on-demand users and for services such as EC2 and its Bedrock AI model platform. Jassy said Amazon "could invest a lot more and it wouldn't be a bad use of capital," Reuters reported.
The comments extend a warning Amazon gave with its second-quarter results on July 30, when management said it would not have enough capacity to meet all 2026 demand and expected the same constraint in 2027. In that quarter AWS revenue rose 37% from a year earlier to $42.2 billion, its fastest growth in 18 quarters, and operating income reached $16.6 billion. Amazon lifted its 2026 cash capital spending plan to about $220 billion from the $200 billion it set out in February, citing higher memory costs.
Why it matters: Jassy's remarks land as investors question the payback on AI infrastructure spending, and they point to multi-year booked demand behind Amazon's budget rather than speculative build-out. The next checkpoint is Amazon's third-quarter report on October 29, where investors will look for whether AWS growth holds near the second quarter's 37% pace and whether the company moves its capex plan above $220 billion, as Jassy suggested it could.