Amazon Cloud Growth Fails to Impress Investors Despite Strong Quarter

Amazon's cloud division grew strongly in the third quarter, but investors reacted with disappointment. Total revenue rose 12 percent year-over-year to $201.9 billion, while cloud unit AWS saw a 39 percent increase in revenue. AWS contributed the largest share to operating profit, which jumped 60 percent to $28.1 billion, driven by heavy use from AI firms like Anthropic and OpenAI. However, Amazon's infrastructure investments surged to over $77 billion in the quarter, far exceeding analyst expectations, while online retail sales grew only 2 percent. The stock fell more than 6 percent in after-hours trading following the results. The high capital expenditures on data centers and equipment, needed to meet AI demand, weighed on investor sentiment despite the strong cloud performance.