News

Amazon CEO: AWS Is a $10 Billion Business

Amazon CEO Jeff Bezos hailed his company's decade-old cloud business this week, saying that Amazon Web Services (AWS) is growing at a faster rate than its parent company did at 10 years old.

"Amazon Web Services is reaching $10 billion in annual sales...doing so at a pace even faster than Amazon achieved that milestone," Bezos wrote in a letter to shareholders filed with the U.S. Securities and Exchange Commission on Tuesday.

Bezos has good reason to shine the spotlight on AWS. In the 10 years since hitting the scene with its Simple Storage Service (S3), Amazon's cloud unit has emerged as company's fastest-growing business, handily outpacing its bread-and-butter retail segments.

In Amazon's recent fourth-quarter earnings report, in which the company fell short of analyst expectations, AWS provided the lone bright spot, with revenue balooning by 69 percent year-over-year and operating income by 186 percent year-over-year (amounting to $2.4 billion and $687 million, respectively).

"AWS is bigger than Amazon.com was at 10 years old, growing at a faster rate," Bezos said in the letter.

He touted AWS' constantly growing roster of offerings as a key driver of that growth, noting that AWS rolled out 722 new features and services in 2015, up by 40 percent from 2014.

"AWS is made up of many small teams with single-threaded owners, enabling rapid innovation. The team rolls out new functionality almost daily across 70 services, and that new functionality just 'shows up' for customers -- there's no upgrading," Bezos said.

The letter shared other AWS statistics and milestones. AWS is now used by over 1 million customers and offers 70 discrete services, Bezos said. Its footprint comprises 33 datacenter availability zones spread across 12 geographic regions worldwide.

The Aurora database engine, which became generally available last year, is now the fastest-growing product in AWS history, followed by the Redshift managed data warehouse service.

And, in a nod to the ongoing cloud price war between AWS, Google and Microsoft, Bezos said that AWS has lowered its prices 51 times, "in many cases before there was any competitive pressure to do so."

"[T]he service is only going to get better from here," Bezos said. "As the team continues their rapid pace of innovation, we'll offer more and more capabilities to let builders build unfettered, it will get easier and easier to collect, store and analyze data, we'll continue to add more geographic locations, and we'll continue to see growth in mobile and 'connected' device applications. Over time, it's likely that most companies will choose not to run their own data centers, opting for the cloud instead."

About the Author

Gladys Rama is the senior site producer for RCPmag.com and senior editor of AWSInsider.net.

Featured