Amazon Web Services concluded 2025 by achieving its most robust quarterly growth rate in over three years.
On Thursday, the company announced that its cloud services division generated $35.6 billion in revenue during the fourth quarter of 2025. This impressive sum represents a 24% year-over-year surge and signifies the segment's most substantial growth in 13 quarters. Amazon also noted that the cloud business now boasts an annual revenue run rate of $142 billion. Furthermore, the cloud service's operating income rose significantly, climbing from $10.6 billion in the fourth quarter of 2024 to $12.5 billion in the corresponding period of 2025.
During the company's fourth-quarter earnings call, Amazon CEO Andy Jassy emphasized the distinctiveness of AWS's performance. He stated, "It’s very different having 24% year-over-year growth on $142 billion annualized run rate than to have a higher percentage growth on a meaningfully smaller base, which is the case with our competitors." Jassy further asserted, "We continue to add more incremental revenue and capacity than others, and extend our leadership position."
This robust growth in the fourth quarter was primarily driven by new strategic agreements forged with prominent clients such as Salesforce, BlackRock, Perplexity, and the U.S. Air Force, alongside other key corporate and governmental entities.
Jassy highlighted AWS's market dominance, noting, "More of the top 500 U.S. startups use AWS as their primary cloud provider than the next two providers combined." He also underscored the ongoing expansion, adding, "We’re adding significant easy to core computing capacity each day."
In a move to further bolster its infrastructure, AWS expanded its data center network by adding over a gigawatt of power during the fourth quarter.
Jassy indicated that a substantial portion of AWS's business continues to originate from enterprises transitioning their infrastructure from on-premise setups to the cloud. Furthermore, AWS is experiencing a significant uplift from the burgeoning AI boom, with Jassy attributing this success to the comprehensive, top-to-bottom AI stack functionality offered by AWS.
"We consistently see customers wanting to run their AI workloads where the rest of their applications and data are," Jassy explained, elaborating on customer behavior. He continued, "We’re also seeing that as customers run large AI workloads on AWS, they’re adding to their core AWS footprint as well."
In the fourth quarter, AWS contributed significantly to Amazon's total revenue, accounting for 16.6% of the company's overall $213.4 billion earnings.
Despite AWS's impressive performance, the results did not fully satisfy Amazon investors. Following the announcement, Amazon's shares experienced a 10% decline in after-hours trading, as investors reacted to the company's planned increase in capital expenditures and the reported earnings per share falling short of Wall Street's projections.
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