Seattle: Amazon Web Services has committed most of its available cloud computing capacity through 2027, with a substantial portion of its capacity for 2028 already booked, as demand for artificial intelligence continues to grow, Amazon chief executive Andy Jassy has said.
The announcement highlights the pressure on major technology companies to expand the infrastructure needed to develop and operate artificial intelligence systems. Despite plans for heavy investment, Amazon is struggling to increase computing capacity quickly enough to meet all the demand from AI research laboratories and business customers.
Jassy made the remarks on 23 October during a video podcast conversation with Ben Horowitz, co founder of venture capital firm Andreessen Horowitz, and its general partner Erik Torenberg. He said Amazon could invest considerably more in cloud infrastructure and that such spending could be justified by the strength of customer demand.
Jassy said that Amazon's cloud capacity for 2026 was already sold out, while most of its capacity for 2027 had been committed. A substantial portion of the capacity planned for 2028 had also been booked.
However, this does not mean that all Amazon cloud services are unavailable. Jassy explained that the company continues to reserve some capacity for customers using on demand services, including Amazon Elastic Compute Cloud, known as EC2, and its artificial intelligence service, Amazon Bedrock.
Cloud computing allows businesses to access computing power, data storage and other technology services over the internet without having to build and operate all the necessary infrastructure themselves. Amazon Web Services, commonly known as AWS, is a major provider of these services.
The growing use of artificial intelligence has increased demand for powerful computers, specialised processors and large data centres. These facilities require substantial investment in servers, electricity, cooling systems and networking equipment. Building and equipping new data centres also takes time, meaning additional investment does not immediately translate into available computing capacity.
Amazon plans to spend approximately $220 billion in capital expenditure during 2026, according to the company's updated forecast. The figure represents an increase from its earlier estimate of approximately $200 billion. Higher memory costs contributed to the increase, while strong demand for AI infrastructure has continued to drive investment.
The scale of AWS's business provides further context for the latest announcement. Amazon reported that AWS generated $42.2 billion in revenue during the second quarter of 2026, an increase of 37 per cent compared with the same period a year earlier. The division's annualised revenue run rate reached $169 billion, a measure based on its quarterly performance rather than revenue already earned over a full year.
The results demonstrate the rapid expansion of AWS as businesses increasingly rely on cloud services for their operations and AI development. Amazon has also been developing its own processors, including Trainium chips, to support artificial intelligence workloads and expand the computing options available to customers.
Despite this growth, the company faces the challenge of balancing infrastructure investment with financial returns. Building data centres and purchasing equipment require substantial spending before the new capacity begins generating revenue. Amazon has acknowledged that rapid investment can put pressure on free cash flow in the short term.
Jassy has also explained that Amazon can adjust some equipment purchases according to demand. While data centres require long term planning and construction, servers and networking equipment can generally be purchased closer to the time they are needed. This gives the company some flexibility if customer demand changes.
The latest announcement does not establish that AWS customers are facing widespread service failures or that cloud prices will rise. It also does not provide a detailed breakdown of the capacity already committed across different regions and services. The extent to which the remaining capacity can meet new customer demand remains unclear.
The development comes as technology companies continue to invest heavily in the infrastructure needed to train AI models and operate them for users. Access to sufficient computing power has become an important factor in how quickly businesses can develop and expand AI products.
Amazon was scheduled to announce its third quarter financial results on 29 October 2026. The results are expected to provide further information about AWS's growth, capital expenditure and plans to expand its infrastructure.
For Amazon, the immediate challenge is to turn its investment into usable computing capacity quickly enough to meet customer demand. With large portions of its future capacity already committed, the pace of infrastructure expansion will remain an important factor in the company's ability to support the continued growth of artificial intelligence.