Amazon Tops $3 Trillion for the First Time as AI Cloud Demand Ignites Hyperscaler Rally

Amazon (AMZN) topped the $3 trillion market-cap mark for the first time during Monday's session (Aug. 3). As of 4 p.m. ET, shares were at $284.02, up 4.58% (+$12.44) from the prior close of $271.58, after opening at $278.29 and hitting an intraday high of $287.20 and a low of $278.^{[24/7 Wall St]}The rally extended last week's post-earnings surge, as investors grow more confident in Amazon's position as one of the biggest beneficiaries of the global AI spending boom.^[IBTimes]

Q2 Beats Across the Board, AWS Is the Growth Engine

Amazon's Q2 report last week showed adjusted EPS of $1.97, well ahead of the $1.82 analysts expected, and total quarterly revenue of $20.061B, also topping the Street's $19.647B forecast.^[IBTimes]AWS contributed $4.22B in quarterly revenue, beating the $4.054B analysts had penciled in by more than $1.6B.^[Quartz]

Per Quartz, CEO Andy Jassy told investors on the earnings call that the company now expects capex of $220B this year, up from the $200B it projected in February. Jassy attributed the increase to rising memory prices driven by AI buildouts.^[Quartz]

"But even at that number, we still don't have enough capacity to meet all of the demand we see in 2026, and I believe that will continue into 2027," Jassy said on the call. "In fact, we already have a meaningful amount of demand lined up for 2028."^[Quartz]

The $3 Trillion Club: Two Years, One Trillion

According to Yahoo Finance, Amazon now joins an elite group — companies with a market cap above $3 trillion — a threshold previously reached only by Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL) and Nvidia (NVDA). Nvidia leads the pack as the world's most valuable company at nearly $5 trillion.^{[Yahoo Finance]}

Amazon first hit a $2 trillion market cap in June 2024, meaning it took just over two years to add another trillion.^[Quartz]On Monday, shares rose roughly 4% to 5% intraday to a record high, marking the biggest one-day gain since May 5. As of Monday, the stock was up more than 23% year-to-date.^[Quartz]

Hyperscalers Rally, Geopolitics Boost Risk Appetite

Amazon wasn't the only big tech stock moving Monday. Per 24/7 Wall St, Microsoft (MSFT) rose 5% to $488.16, Meta Platforms (META) led the group with a 7% gain to $593.15, Alphabet (GOOGL) climbed 5% to $374.40, and Oracle (ORCL) jumped 8% to $139.80. The Invesco QQQ Trust (QQQ) gained 1.67% to $699.45.^{[24/7 Wall St]}

Per 24/7 Wall St's analysis, the catalysts behind the moves in Microsoft, Amazon, Meta, Alphabet and Oracle were last week's strong hyperscaler earnings and a rebound in risk appetite after President Trump scrapped plans to strike Iran.^{[24/7 Wall St]}

Cloud Rivals Post Strong Results, Capex Race Continues

Amazon's cloud rivals also turned in strong numbers last week. Per Quartz, Microsoft's Azure cloud revenue grew 43% in its fiscal Q4, while Google Cloud reported 82% growth.^[Quartz]

24/7 Wall St's Quick Read summary noted that Microsoft Azure's annual sales topped $100B, Alphabet raised capex to $205B, and Oracle's cloud infrastructure grew 93% — though Oracle shares are still down 28% year-to-date. Meta Platforms led the group with ad revenue up 27% to $59B, recouping the 9% drop it suffered after its Q2 report.^{[24/7 Wall St]}

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