AMZN Stock Rises After Q2, AWS Beat: CEO Says Even Higher CapEx Won’t Be Enough To Meet Soaring Cloud Demand

• Amazon raised its 2026 CapEx target by $20 billion to $220 billion.
• The market reaction for Amazon was the opposite for Alphabet, which slid last week after raising its 2026 CapEx while reporting record growth in its cloud business.
• Stocktwits sentiment for AMZN shifted to ‘extremely bullish’ from ‘bullish.’

Amazon’s second-quarter results offered one of the clearest bullish signals for the cloud market in recent times, fueling gains across cloud stocks.

Amazon shares rose 10.4% in overnight trading ahead of Friday, with CoreWeave and Nebius jumping 4% and 6.5% respectively.

The company said sales at Amazon Web Services – which is the largest cloud company in the world – grew 37% to $42.2 billion, beating analyst expectations of $40.6 billion.

Amazon, which is building new data centers to meet the soaring demand, raised its full-year capital expenditure forecast by $20 billion to $220 billion, citing higher memory component costs.

Amazon Indicates Record Cloud Demand

But the biggest draw came when Amazon management said that even with its record spending, the new capacity would not be enough to meet the soaring cloud demand.

“We will still not have enough capacity to meet all the demand we have in 2026. And I believe this dynamic will also be true in 2027 too. In fact, the demand we already have for 2028 is striking,” Amazon CEO Andy Jassy said on the company’s analyst call.

“We've long believed AWS could become a few hundred billion dollars revenue business and now believe it will be at least double that and very possibly be [a] $1 trillion annual revenue business for us in time with very appealing accompanying free cash flow and return on invested capital,” he said.

Interestingly, the market reaction for Amazon was the opposite for Alphabet, which slid last week after raising its 2026 CapEx while reporting record growth in its cloud business. If AMZN’s overnight gains hold on Friday, it would be the stock’s best single-day move in over a year.

Retail's View On AMZN

On Stocktwits, the retail sentiment for AMZN shifted to ‘extremely bullish’ for ‘bullish’ the previous day, while message volume rose over 360%.

“$AMZN demonstrates a clean beat: AWS re‑accelerates, margins expand, ads scale, retail profitable. Q3 guide steady. Capex elevated but predictable. A 'technical' trade is just the entry — the thesis is earnings strength + forward clarity. So, IMO, we should be/stay long,” said a trader. 

Another wrote: “1 trillion $ business for AWS (not including the other sectors) is insane.”

Amazon Q2 Results Recap

Amazon’s revenue increased 20% to $201 billion, beating expectations of $196.5 billion, while profit was sharply higher than Wall Street's target. 

Earnings per share surged to $5.75, a substantial rise from $1.68 in the prior year, significantly beating Wall Street projections of $1.82. 

For the third quarter, the company forecast revenue to be between $197.0 billion and $202.0 billion, which would be 9% to 12% higher year over year.

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