As Amazon reaps the benefits of its cloud computing and AI investments, its market value surpassed the $3 trillion mark for the first time in its history. The company's shares continued their rise after strong quarter results, enabling it to reach this milestone.
Joining the Tech Giants Club
Amazon shares traded at $284.91, a 4.91% increase, and reached an all-time high of $287.20 during the session. This performance pushed the company's market value to approximately $3.07 trillion, making it the fifth company to surpass the $3 trillion mark. Amazon joined this club after Apple, Microsoft, Nvidia, and Alphabet. The company first crossed $2 trillion in June 2024, adding roughly $1 trillion to its value in just over two years.
AWS Growth Leads the Way
Amazon's second quarter performance, which ended in June, was driven by a 37% revenue increase in its Amazon Web Services (AWS) unit. AWS recorded its fastest growth in 18 quarters with $42.2 billion in revenue. Though the cloud computing unit accounted for only 21% of total sales, its $16.6 billion operating profit represented over 60% of the company's total operating profit of $27.5 billion. Amazon CEO Andy Jassy said 'AWS is booming,' noting that the AI and chip businesses achieved triple-digit year-over-year growth rates.
Net Profit Surges
The company's second quarter net profit rose to $62.6 billion from $18.2 billion in the same period last year. Earnings per share increased to $5.75 from $1.68. Much of this jump came from $53.4 billion in non-operating income resulting from the revaluation of its Anthropic investment. Operating profit, which reflects core performance, rose 43% to $27.5 billion from $19.2 billion.
Investment Spending Breaks Records
To meet rising demand, Amazon raised its 2026 investment spending forecast from $200 billion to $220 billion. The bulk of this spending is directed toward data centers, AI infrastructure, custom chips, robotics, and satellite projects. However, these massive investments are pressuring the company's cash flow. Over the twelve months ending in June, free cash flow swung to negative $7.6 billion from positive $18.2 billion the previous year.
Billions of Dollars Committed to OpenAI and Anthropic
Amazon is making large direct investments in model developers to strengthen its position in the AI race. Under a multi-year partnership with OpenAI in February, a total investment of $50 billion was committed, with $15 billion upfront. In April, it was announced that an additional $5 billion was invested in Anthropic, with a further $20 billion possible depending on commercial milestones.
General Optimism on Wall Street
Amazon's surge coincided with overall optimism in US stock markets. The S&P 500 index rose 1.17% to 7,577.09 points, the Dow Jones Industrial Average gained 1.1%, or 578 points, to 53,062.83, and the tech-heavy Nasdaq Composite climbed 1.75% to 25,818.02 points. While the market rewarded companies showing clear growth in cloud revenues, those failing to deliver similar returns despite increased spending faced pressure.
