AWS growth reaccelerates to 39% as Amazon's free cash flow swings to a $42 billion outflow
In Q3 results reported October 29, AWS grew 39.3% to $45.98 billion with a $578 billion backlog, while Amazon's consolidated free cash flow turned to negative $42.4 billion from positive $14.8 billion a year earlier on about $220 billion of planned 2026 capital spending.
Amazon reported third-quarter results on October 29, and the two numbers that matter sit on opposite sides of the ledger. AWS revenue grew 39.3% to $45.98 billion, reaching a $184 billion annualized run rate, with a contracted backlog of $578 billion disclosed on the earnings call. At the same time, Amazon's consolidated free cash flow was negative $42.4 billion, compared with positive $14.8 billion a year earlier. CEO Andy Jassy told investors to expect AWS revenue growth above 40% in both 2027 and 2028.
The spend behind the growth
Amazon reaffirmed roughly $220 billion in company-wide cash capital expenditures for 2026, most of it going into the data centers and chips that run AWS, and signaled more to come. The scale shows up in the balance sheet: trailing-twelve-month net purchases of property and equipment reached $210.7 billion, up 82% from a year earlier. That is the spending that flipped free cash flow from a $14.8 billion inflow to a $42.4 billion outflow in the space of a year. The backlog and the run rate say the demand is contracted and real; the cash flow says the bill is being paid now, against revenue that arrives over the life of those contracts.
Why it matters
This is the third big cloud provider in a week to show the same shape: cloud AI revenue growing fast, and the cost of building for it growing faster. For a business deciding whether its own AI spend is worth it, the useful read is the timing. Amazon is paying out tens of billions ahead of the revenue it expects those investments to earn, and the market is now watching whether that revenue shows up on the promised scale. The same question applies one line down, to your own bill: spending committed today is justified only by work it produces over time, and a growing cost is good news only when the value it buys outruns it. The backlog is the bet. Whether it pays is the part still being decided, for Amazon and for anyone buying what it sells.