Amazon Lifts AI Infrastructure Spending to $220B as Demand Outpaces Capacity
AWS posted its fastest growth in 18 quarters as Amazon raised AI infrastructure spending to $220 billion, citing memory costs and saying demand already stretches into 2028.
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Amazon raised its projected spending on AI infrastructure to approximately $220 billion for 2026, citing higher memory costs, yet the company expects AI capacity to remain constrained through 2027 and beyond. Despite this massive investment increase, the company's chief executive stated that demand for AI capacity already extends into 2028, meaning the company will not have enough capacity to meet all customer demand in 2026 and 2027. This situation reflects that the AI industry is still in an infrastructure deployment phase rather than an optimization phase, with compute power, power supply, networking, and data center construction becoming the primary bottlenecks rather than lack of customer interest. The company's strong quarterly results, with AWS revenue growth at its fastest rate in 18 quarters, underscore that the challenge for data center operators is now delivering capacity rather than finding customers.
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