Amazon Tops Big 3 Cloud Stocks as AWS Delivers 59% of Operating Profit

2 articles · Updated · The Motley Fool · Jun 7

Amazon was picked as the best buy among the three biggest cloud stocks because AWS generated 59% of the company’s operating profit in the latest quarter, giving AI-driven cloud growth a more direct impact on earnings.
AWS revenue rose 28%, outpacing Amazon’s North America retail growth of 12% and international growth of 19%, reinforcing the view that Amazon is already cloud-first from a profit perspective.
Microsoft’s Azure grew 40% in its latest quarter, but limited profitability disclosure makes it harder to judge how much that expansion contributes to the broader business.
Alphabet’s Google Cloud posted the fastest growth at 63% in Q1, helped by sales of its custom TPU AI chips, yet the analyst still favored Amazon because its cloud gains translate more clearly to the bottom line.
AI demand underpins the broader thesis: training and inference workloads create recurring, consumption-based cloud revenue that could leave the major providers collecting long-term returns for years.

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Amazon’s $200 Billion AI Bet: AWS Reaccelerates, Custom Silicon Surges, and Cloud Wars Escalate in Q1 2026

Overview

Amazon started 2026 with a strong first quarter, reporting earnings per share of $2.78 and net sales of $181.52 billion, both far above analyst expectations. This performance marked a 17% year-over-year increase in sales and highlighted Amazon's ability to outperform across all major financial metrics. The results were driven by the rapid growth of Amazon Web Services (AWS), which remains the company's main profit engine. AWS's strong momentum, combined with Amazon's expanding retail margins and growing advertising business, reinforced investor confidence and showcased Amazon's effective strategy and operational strength.

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