Amazon’s AWS growth outpaces cash flow with $96.3B in 2026 capital spending
Amazon’s cloud division, AWS, saw 37% year-over-year sales growth in Q2 2026, but the company’s free cash flow turned negative by $7.6 billion over the past 12 months. This gap stems from $169 billion in net capital expenditures—far exceeding the $161.4 billion generated by operating activities. The shortfall reflects heavy investments in technical infrastructure and logistics, not just AWS…
Key points
- Amazon’s AWS sales grew 37% year-over-year in Q2 2026, but its free cash flow dropped **$7.6B** over 12 months due to **$169B** in capital spending
- Broadcom has a **$42B** potential convertible bond framework to support customer lease payments, but no bonds issued yet
- Applied Digital’s new facilities face **$77.4M** in quarterly interest expenses, with financing tied to shareholder dilution
The article breaks down how to assess recovery for AWS and other AI-related players like Broadcom and Applied Digital. Broadcom, which supplies AI semiconductors, has a $42 billion potential convertible bond framework to support customer lease payments, though no bonds have been issued yet. Applied Digital, a data center builder, increased its operating capacity to 250 MW but faces $77.4 million in quarterly interest expenses, with financing tied to shareholder dilution. The analysis warns against simplistic comparisons of cash flows or debt levels, urging readers to track operational metrics—like AWS’s sales growth and capital expenditure trends—over multiple periods to gauge true progress.
The story so far
7 episodes →- Amazon’s AWS growth outpaces cash flow with $96.3B in 2026 capital spendingthis story
AI demand is strong. Who is providing the funding to support it? (Amazon, Broadcom, and Applied Digital's financial burdens and how to read financial results to verify recovery.)
note.com · 28 October 2026
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