Quick Read
Garman declared AWS capacity “spoken for” through 2028, and AMZN posted 37% growth, its fastest in 18 quarters, with shares surging 20% in five sessions.
AWS’s AI and Chips businesses each eclipsed $25 billion run rates at triple-digit growth, with UBS projecting AWS acceleration to 48% next year.
Suppliers MRVL, ALAB, and CRDO are all raising outlooks, with Credo’s revenue jumping 206%, Astera’s stock up 93% year-to-date, and Marvell shares climbing 14%.
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Amazon’s AI spending is settling a debate between the bulls and the bears. Amazon Web Services (AWS) CEO Matt Garman spent Monday on Bloomberg Technology arguing that AWS’s growth is only getting started. He then went to X and quantified it in a way that undercuts every bear case that AI demand is topping out. “Much of our capacity is already spoken for through 2027 and into 2028, and demand still significantly outstrips supply,” Garman wrote. “We’re going to keep building to keep up with what customers are asking for.”
That single promise reframes the debate over hyperscaler capex. Garman is telling the market that AWS has already booked its next two years of infrastructure, which is why the company is comfortable spending at a historic pace.
The Numbers Behind the Quote
Amazon.com (NASDAQ:AMZN) reported Q2 2026 AWS revenue of $42.232 billion, up 37% year-over-year, which management flagged as the fastest growth in 18 quarters. AWS Q2 operating margin came in at 39.4%, and capital expenditures reached $54.208 billion in the quarter, a 68.44% year-over-year jump.
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CEO Andy Jassy sized the AI stack directly, stating: “AWS is booming, growing 36.7% year-over-year in Q2, our fastest growth in 18 quarters, and our AI and Chips businesses each eclipsed run rates of more than $25 billion.” Both are growing at triple-digit rates. AWS chief Garman also flagged a large shift from training to inference workloads, the actual usage of models, which tends to produce sticky, recurring compute demand rather than one-off training bursts.
UBS estimates AWS growth will accelerate to 48% next year as Trainium scales with some help from OpenAI. Prediction markets are echoing the bullish buildout thesis: Polymarket traders assign a 96.3% probability that Amazon’s 2026 capex clears $190 billion. Shares have rallied 20.1% in the past five trading sessions.
