Amazon's cloud margin widens on accelerating revenue growth

Amazon reported that revenue from its cloud unit, Amazon Web Services (AWS), increased by 17% YoY in the first quarter, surpassing Wall Street’s expectations. AWS generated $25.04 billion in revenue, higher than the estimated $24.49 billion. This growth is an improvement from the 13% increase in the previous quarter. AWS represents 17% of Amazon’s overall revenue. With its high software margins, AWS delivered $9.42 billion in operating income, accounting for around 62% of Amazon’s total. The AWS operating margin widened to 37.6%, the highest since 2014. Google and Microsoft also reported strong growth in their cloud businesses. During the quarter, Amazon announced a $4 billion investment in AI startup Anthropic, which relies on AWS chips for training AI models.