When you think of artificial intelligence (AI) companies, Amazon (NASDAQ: AMZN) may not be a name that jumps to the top of the list. However, with its cloud computing business delivering an incredible 37% year-over-year growth rate, I think it's a force to be reckoned with. While there may be companies that are growing faster than that, Amazon's growth rate is picking up, and it could stay hot for several years based on the company's massive investments in AI computing infrastructure.
This could lead to Amazon being one of the biggest winners in the next phase of the AI arms race, and if you don't own shares already, it isn't too late to buy. This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia.
For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue » Amazon Web Services (AWS) is Amazon's cloud computing division. It's the No. 1 competitor by market share, with about 28% last quarter.
In Q2, it accounted for 21% of the company's total revenue, but 60% of its operating profits. That's an incredible contribution from a small business unit, and with AWS growing rapidly, Amazon as a whole will benefit. While the other two cloud computing titans -- Alphabet's Google Cloud (15% market share) and Microsoft Azure (20% market share) -- reported faster growth than AWS, what investors must understand is that AWS' growth rate is rapidly accelerating.
In Q3 2025, AWS' growth rate was 20%. In Q4 2025 and Q1 2026, its year-over-year growth accelerated to 24% and 28%, respectively. In Q2, the growth rate jumped further to 37%, and it likely isn't done there.
Amazon is spending the most of any AI hyperscaler on computing infrastructure this year, with capital expenditures expected to total around $220 billion. All of that spending will eventually convert into increased computing capacity, which will in turn lead to increased revenue. A larger revenue base will allow Amazon to invest even more in data center infrastructure, creating a growth flywheel that should send Amazon stock soaring, as long as there is demand for compute.
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