Amazon Q1 Earnings Preview: 5 Anthropic, AWS And Middle East Things To Watch For

Why It Matters

AWS’s growth drives the bulk of Amazon’s profit, so its performance directly shapes the conglomerate’s earnings trajectory. The Anthropic deal and Middle‑East disruptions illustrate how AI competition and geopolitical factors can quickly impact cloud revenue and operational resilience.

Key Takeaways

• AWS forecast 26% YoY growth, $36.8B revenue Q1 2026.
• Anthropic deal promises $100B revenue for AWS over 10 years.
• Middle East drone attacks disrupted AWS data centers, may affect earnings commentary.
• Amazon plans $200B capex, focusing on AWS and data center expansion.
• Google invests up to $40B in Anthropic, heightening cloud AI competition.

Pulse Analysis

Analysts expect Amazon’s cloud arm to post a 26 percent year‑over‑year increase in the first quarter, translating to roughly $36.8 billion in revenue. That would be a modest acceleration from the 24 percent rise that delivered $35.6 billion in Q4 2025 and a clear sign that AWS can still expand on an already massive base. The forecast is a key barometer for investors because AWS supplies more than half of Amazon’s operating profit, and any slowdown would immediately pressure the conglomerate’s margins.

The $100 billion, ten‑year commitment from Anthropic locks Amazon into a steady stream of AI‑related compute demand, while the upfront $5 billion investment and a potential $20 billion follow‑on tie revenue to performance milestones. By dedicating up to 5 GW of Trainium and Graviton capacity, AWS positions itself as the primary training ground for Claude, Anthropic’s flagship model. Google’s parallel $40 billion pledge intensifies the cloud AI rivalry, forcing Amazon to differentiate its services and justify the sizable financial exposure in a market where customers can switch between providers with relative ease.

Geopolitical turbulence adds another layer of uncertainty. Drone strikes on AWS facilities in the United Arab Emirates and Bahrain have already forced customers to reroute workloads, raising questions about resilience and cost implications. At the same time, Amazon’s $200 billion capital‑expenditure plan, heavily weighted toward data‑center expansion, will be scrutinized for any adjustments in response to rising energy prices and regional instability. Investors will watch the Q1 earnings call for guidance on how the company balances growth ambitions with risk mitigation across its global infrastructure.