AWS is largely sold out through 2027, Andy Jassy says

Amazon's cloud unit has more demand than it can serve. Reuters reported that Amazon CEO Andy Jassy said on Friday, Oct. 23, that AWS computing capacity is mostly sold out through 2027, with large commitments stretching into 2028.

Jassy was blunt about how far ahead the bookings run. "2027 is largely sold out," he said, according to Reuters, which reported that he spoke in a video podcast hosted by Ben Horowitz, who co-founded Andreessen Horowitz, and Erik Torenberg, a partner at the firm.

Key facts

• Reuters reported that Jassy said AWS capacity for 2026 is already fully booked.
• Amazon said AWS sales grew 37% from a year earlier to $42.2 billion in the second quarter of 2026.
• Amazon said the AI business inside AWS topped a $25 billion annual revenue run rate, growing at triple-digit rates.
• CNBC reported that Amazon lifted its 2026 capital spending forecast to $220 billion in July, up from $200 billion in February.
• Reuters reported that Amazon will post third-quarter results on October 29.

Why capacity is tight

Jassy described a company running to keep up. Reuters reported that Jassy said Amazon is having trouble matching demand from AI labs and businesses.

He also suggested the company has room to spend more. Reuters reported that Jassy said 2026 capacity is gone and that Amazon could invest far more.

Not every server is spoken for. Reuters reported that Jassy said AWS always holds back some capacity for on-demand customers and for its Bedrock inference service and EC2, though the large blocks of 2027 are taken.

The backlog shows how much work is waiting. CNBC reported that Jassy said AWS's backlog, meaning signed work not yet running, hit $496 billion in the second quarter.

Background

The cloud business is growing fast and earning more. Amazon said AWS operating income reached $16.6 billion in the second quarter, up from $10.2 billion a year before.

Spending has jumped to build more data center capacity. CNBC reported that Amazon's capital expenditures hit $54.2 billion in the June quarter, compared with $32.1 billion a year earlier. Reuters reported that Amazon had said earlier this year it planned about $220 billion in 2026 capital spending.

Higher costs played a part in that plan. CNBC reported that Amazon raised its 2026 forecast to $220 billion from $200 billion in July and pointed to higher memory prices.

The heavy spending has squeezed cash. CNBC reported that Amazon's free cash flow over the trailing twelve months was an outflow of $7.6 billion, against an inflow of $18.2 billion a year before.

Jassy signaled the crunch months ago. CNBC reported that in July, Jassy said even $220 billion in spending would leave Amazon short of capacity for all 2026 demand, and he expected the same for 2027.

What it means for you

Businesses that build on AWS are now competing with AI labs for the same resources. Reuters reported that EC2 supplies cloud servers for running apps and Bedrock gives customers access to AI models, while demand is coming from both AI labs and businesses.

For most customers, some room remains. Reuters reported that Jassy said AWS keeps a share of capacity set aside for on-demand use and for Bedrock and EC2.

The AI side of AWS is a big part of the pull. Amazon said its AWS AI business is now above a $25 billion annual run rate and growing by triple digits. Jassy's wording also matters. He said 2027 is largely sold out, not completely sold out, and it is not known how much 2027 capacity is still open.

Practical steps

• Watch Amazon's next report. Reuters reported that Amazon posts third-quarter results on October 29.
• Review the last quarter's numbers. Amazon's second-quarter results release lists AWS sales, operating income and AI run-rate figures.
• Note the spending plan. CNBC reported that Amazon expects about $220 billion in capital spending for 2026.

What happens next

The next update is days away. Reuters reported that Amazon's third-quarter report on October 29 will be its next update on AWS growth and spending.

Investors will be watching the spending plan. It is not known whether Amazon will raise its capital spending plan above $220 billion when it reports.

FAQ

Can customers still get AWS capacity? Reuters reported that Jassy said AWS always keeps some capacity for on-demand use, Bedrock and EC2, even though most of 2027 is sold.

How much is Amazon spending? CNBC reported that Amazon expects about $220 billion in 2026 capital spending, up from a $200 billion plan.

How fast is AWS growing? Amazon said AWS sales grew 37% to $42.2 billion in the second quarter of 2026.

How big is the AWS backlog? CNBC reported that Jassy put the AWS backlog at $496 billion in the second quarter.

When does Amazon report next? Reuters reported that third-quarter results are due on October 29.

Where did Jassy make the comments? Reuters reported that he spoke on a video podcast with Ben Horowitz and Erik Torenberg of Andreessen Horowitz.

How large is AWS's AI business? Amazon said the AI business passed a $25 billion annual revenue run rate and is growing at triple-digit rates.

How much did Amazon spend last quarter? CNBC reported that capital expenditures reached $54.2 billion in the June quarter, up from $32.1 billion a year earlier.

Is AWS profitable? Amazon said AWS earned $16.6 billion in operating income in the second quarter, compared with $10.2 billion a year earlier.