![\"The](\"https:\/\/www.europesays.com\/ai\/wp-content\/uploads\/2026\/05\/00fbc2698f64d3217fb60d7810c9e2ee.png\")
Image source: The Motley Fool. Amazon’s custom chip service is booming <\/p>\n
At first glance, you may wonder what the big deal is about AWS, since it accounted for only 21% of Amazon’s total sales in the first quarter. However, that’s not the important metric here. AWS has a far better operating margin than its commerce counterpart, so revenue isn’t the best metric for analyzing Amazon. Instead, investors should focus on the $14.6 billion in operating income AWS produced — 59% of Amazon’s total. AWS accounted for more than half of Amazon’s total operating income, despite accounting for only a fifth of its total sales.<\/p>\n
That makes AWS Amazon’s most important division, and it just delivered 28% revenue growth in Q1 — the fastest of any of Amazon’s business segments. When your most profitable division is the fastest-growing, that bodes well for the state of the business.<\/p>\n
Inside AWS, it’s seeing massive demand for its custom AI chips, which are growing at a triple-digit year-over-year percentage. It also announced that several leading AI companies, including OpenAI and Anthropic, are using Amazon’s Trainium chips, showcasing the prowess of these units. AWS is starting to dominate the AI space after falling a bit behind. As Amazon spends $200 billion on capital expenditures in 2026, it paves the way for in-demand computing capacity that will continue to make Amazon a ton of money at a high margin. This is a long-term investment play, and Amazon just showed investors that as long as you stay patient, its strategy will pay off. <\/a><\/p>\n With Amazon’s overall revenue growth rate coming in at 17% year over year, it just wrapped up the best quarter since 2021, when it was coming down from a pandemic-era business acceleration.<\/p>\n This is the best Amazon’s business has looked in a long time, and it’s mostly thanks to Amazon’s AI strategy via AWS. This is a long-term investing theme, and makes the stock a solid buy-and-hold now. <\/a><\/p>\n We just issued ‘double down’ alerts on 3 stocks \u2014 find out if\u00a0Amazon made our list <\/p>\n Ever feel like you missed the boat in buying the most successful stocks? Then you\u2019ll want to hear this.<\/p>\n On rare occasions, our expert team of analysts issues a \u201cDouble Down\u201d stock<\/a> recommendation\u00a0for companies that they think are about to pop. If you\u2019re worried you\u2019ve already missed your chance to invest, now is the best time to buy before it\u2019s too late. And the numbers speak for themselves:<\/p>\n Nvidia:\u00a0if you invested $1,000 when we doubled down in 2009,\u00a0you\u2019d have $517,658!*<\/p>\n Apple: if you invested $1,000 when we doubled down in 2008, you\u2019d have $51,670!*<\/p>\n Netflix: if you invested $1,000 when we doubled down in 2004, you\u2019d have $504,832!*<\/p>\n Right now, we\u2019re issuing \u201cDouble Down\u201d alerts for three incredible companies, available when you join\u00a0Stock Advisor, and there may not be another chance like this anytime soon.<\/p>\n See the 3 stocks \u00bb<\/a><\/p>\n *Stock Advisor returns as of April 27, 2026<\/p>\n Keithen Drury<\/a> has positions in Amazon. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy<\/a>.<\/p>\n<\/a> Data by <\/a>YCharts.<\/a> <\/p>\n