- Amazon’s last quarter capex was $26.3 billion last quarter, with growth set to continue
- Company plans to spend big on AI projects in 2025 to keep pace with rivals
- Microsoft and Google are also spending more on AI
Amazon‘s CEO appears to have indirectly revealed the company plans to allocate around $100 billion to capital expenditure in 2025, with much of the money destined for AI.
The news comes as the ecommerce and cloud computing giant announced its fourth-quarter and year-end financial results.
Amazon revenue for the final three-month period of 2024 climbed 10% year-over-year to $187.8 billion, boosting its full-year revenue to $638.0 billion, up 11% compared with 2023.
Amazon will invest even more money in 2025
Its Amazon Web Services cloud divison, accounted for around 15-17% of its entire revenue, depending on whether we take a quarterly or annual overview. Both periods saw 19% increases year-over-year.
Speaking with investors on an earnings call, CEO Andy Jassy suggested Amazon may spend more than $100 billion in the year ahead: “We spent $26.3 billion in capex in Q4, and I think that is reasonably representative of what you expect an annualized capex rate in 2025.”
Although a lack of figures doesn’t allow us to quantify the bold claims, Jassy added: “The vast majority of that capex spend is on AI for AWS.”
It’s not just Amazon looking to increase its capital expenditure to keep up with demand for artificial intelligence. Google recently revealed it would be spending $75 billion this year, with Microsoft set to invest $80 billion.
It’s no surprise Amazon’s investments will far exceed its key hyperscaler rivals – Canalys has its market share at a staggering 33%; Microsoft and Google occupy 20% and 10% of the market respectively. Just last month, Amazon unveiled an $11 billion investment into data centers in the state of Georgia.
The consensus is that investing more will help make AI more accessible and increase its use cases, therefore bringing more money in for the companies.
