Amazon's Value Surpasses $3 Trillion for the First Time

Amazon’s market capitalization surpassed $3 trillion for the first time on Monday, buoyed by a sharp rise in its shares following the company’s announcement of strong earnings and signs that the artificial intelligence boom is driving new demand for its cloud computing services, which are the main engine of the company’s profits.

The stock of the e-commerce and cloud computing giant, headquartered in Seattle, jumped 15% on Friday after recording its strongest growth in the cloud computing sector in more than four years, and raised its annual capital expenditure guidance.

Amazon and Microsoft are the only two companies among the “Magnificent Seven” whose AI spending has yielded returns in the eyes of investors. They are among six companies that have reported results so far.

In contrast, Tesla, Alphabet, and Meta faced criticism after their massive spending plans negatively impacted free cash flow in the previous quarter.

Along with other tech giants on Wall Street, Amazon continues to pour billions into developing its AI infrastructure. In April, it revealed a new investment in Anthropic, following an earlier announcement this year that it intended to invest up to $50 billion in OpenAI.

It took just over two years for the company, founded by Jeff Bezos in 1994, to add another trillion dollars to its market capitalization after it first reached $2 trillion in June 2024.

Apple, Microsoft, Alphabet, and Nvidia are other companies that have previously reached a market capitalization of $3 trillion. Nvidia is currently the world’s largest company, with a market capitalization nearing $5 trillion.