Amazon Raises 2026 Capital Expenditure to $220 Billion for AI

Amazon has increased its projected capital expenditure for 2026 to approximately $220 billion, rising from an initial estimate of $200 billion. This spending surge is driven by the escalating cost of memory chips and the urgent need to expand AI infrastructure and AWS data centers. The company reports that customer demand already extends into 2028.

CEO Andy Jassy warned that despite these investments, AI capacity will likely remain constrained through 2027. To address this, Amazon is prioritizing infrastructure and custom silicon. Both Anthropic and OpenAI have entered multi-year, multi-gigawatt commitments to utilize Amazon's Trainium AI accelerators, and the company is exploring the sale of Trainium chips to third-party data centers.

Amazon Web Services reported a 36.7% year-over-year revenue increase to $42.2 billion. Chief Financial Officer Brian T. Olsavsky noted that enterprises are expanding core cloud consumption in tandem with AI deployments. This investment aligns with a wider industry trend, with major technology companies collectively spending an estimated $700 billion on AI infrastructure this year.