Amazon $AMZN crossed a $3 trillion market capitalization for the first time on Monday, driven by a stronger-than-expected second-quarter earnings report that showed a surge in cloud computing revenue fueled by artificial intelligence demand, according to CNBC.
Amazon stock rose roughly 4% to 5% on Monday, hitting a record high. The gain marked the stock's best single session since May 5. Amazon stock has gained more than 23% so far this year.
Amazon Web Services posted $42.2 billion in revenue for the quarter. That exceeded analyst expectations of $40.54 billion, according to CNBC. Total company revenue of $200.61 billion surpassed the $196.47 billion Wall Street had forecast. Adjusted earnings per share came in at $1.97. The consensus estimate was $1.82.
Amazon CEO Andy Jassy told investors on the company's earnings call that capital expenditures are now projected to reach $220 billion this year, up from the $200 billion the company projected in February. Rising memory prices tied to the AI buildout drove the increase, he said.
"But even at that amount, we will still not have enough capacity to meet all the demand we have in 2026, and I believe this dynamic will also be true in 2027 too," Andy Jassy said. "In fact, the demand we already have for 2028 is striking."
Amazon joins Apple $AAPL, Microsoft $MSFT, Alphabet $GOOGL, and Nvidia $NVDA in the exclusive group of companies that have ever hit a $3 trillion valuation, according to Yahoo Finance. Among them, Nvidia holds the top spot as the most valuable company in the world, with a market cap approaching $5 trillion. Amazon reached the $2 trillion threshold for the first time in June 2024, meaning it needed a little more than two years to stack on an additional trillion dollars in market value, according to Yahoo Finance.
Other large technology stocks moved higher alongside Amazon on Monday, with Microsoft adding 4%, Meta $META Platforms jumping 6%, Alphabet gaining 3.6%, and Oracle $ORCL advancing 5%.
Amazon's cloud rivals also posted strong results last week. Microsoft Azure cloud revenue rose 43% during its fiscal fourth quarter, and Google Cloud reported 82% growth.