**Amazon and Alphabet Report Strong Cloud Growth Amid Tech Stock Downturn**
In the fourth quarter of 2025, Amazon’s cloud computing segment, Amazon Web Services (AWS), reported a 24% year-over-year revenue increase, generating $35.6 billion. Overall, Amazon’s net sales rose 14% to $213.4 billion, with AI workloads driving growth. The company anticipates $200 billion in capital expenditures for 2026 as it invests in infrastructure and technology.
Alphabet’s cloud business outperformed with stunning growth, achieving a 48% year-over-year revenue jump to $17.7 billion, contributing to the company’s overall quarterly revenue of $113.8 billion—an 18% increase. Its Google Cloud division is now operating at an annual run rate exceeding $70 billion. Alphabet forecasts capital expenditures between $175 and $185 billion for 2026 to meet increasing customer demand.
Both companies have seen their stock prices decline about 13% year-to-date amidst a challenging tech market. However, Alphabet’s higher cloud growth rate and slightly lower valuation, with a price-to-earnings ratio of 25 compared to Amazon’s 28, position it as a more attractive investment option according to analysts.
