Amazon Web Services ended 2025 with its highest quarterly growth rate in more than three years.
The company reported Thursday that its cloud services business posted revenue of $35.6 billion in the fourth quarter of 2025. This was a 24% increase over the previous year, marking the division’s largest growth rate in 13 quarters. According to Amazon, this business unit has an annual revenue run rate of $142 billion. Cloud services operating income also increased from $12.5 billion in the fourth quarter and $10.6 billion in the same period in 2024.
“Achieving 24% year-over-year growth at an annualized run rate of $142 billion is very different from achieving higher growth rates on a significantly smaller base, as is the case with our competitors,” Amazon CEO Andy Jassy said on the company’s fourth-quarter earnings call. “We continue to add more revenue and production capacity than our competitors, expanding our leadership position.”
Growth in the fourth quarter was driven by new agreements with companies and government agencies, including Salesforce, BlackRock, Perplexity, and the U.S. Air Force.
“More of the top 500 startups in the U.S. use AWS as their primary cloud provider than the next two providers combined,” says Jassy. “We are easily adding significant amounts of core computing power every day.”
AWS also added more than 1 gigawatt of power to its data center network in the fourth quarter.
Jassy said he believes AWS still sees a significant portion of its business from companies looking to move their infrastructure from on-premises to the cloud. Of course, AWS has also benefited from the AI boom, and Jassy credited AWS’s top-to-bottom AI stack capabilities.
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“We always want our customers to run their AI workloads where their other applications and data are,” Jassy says. “We also see that our core AWS footprint is also increasing as our customers run larger AI workloads on AWS.”
AWS accounted for 16.6% of Amazon’s overall revenue of $213.4 billion in the fourth quarter.
But AWS’s success wasn’t enough to convince Amazon’s investors. Amazon shares fell 10% in after-hours trading as investors reacted to Amazon’s capital spending expansion plans and earnings per share fell short of Wall Street expectations.
