Amazon’s cloud business, AWS, has seen its growth slow, raising questions about the outlook for Amazon’s stock performance. While AWS remains the largest cloud provider by a significant margin, recent earnings reports show its growth is lagging behind key rivals, particularly Microsoft Azure and Google Cloud. This has contributed to investor wariness, as Wall Street increasingly views Amazon’s cloud dominance as potentially at risk.

In its latest quarter, AWS posted a 17.5% year-over-year revenue increase, translating to $30.9 billion. Over the past year, AWS generated nearly $108 billion in revenue, marking a 19% annual rise. However, Microsoft Azure’s growth has accelerated to 34% year-over-year, while Google Cloud reported a 31% annual increase, reflecting faster gains at its main competitors. This divergence in growth rates is fueling a perception that AWS is beginning to lose some of its edge, even though it still claims the largest share of the global cloud market.

Amazon CEO Andy Jassy has sought to reassure investors by highlighting AWS’s scale, security advantage, and continued leadership. Jassy noted that the majority of global IT spending is still on traditional on-premises infrastructure, suggesting substantial room remains for cloud adoption across industries. He described current supply and capacity constraints—such as power and component shortages—as temporary challenges rather than long-term limits to AWS’s growth.

Despite these reassurances, the competitive environment is intensifying as organizations accelerate cloud and AI workloads. While AWS is still a giant with unmatched infrastructure and security, its slower growth relative to competitors could persist as businesses continue to diversify their cloud spend. For investors, the possibility of continued underperformance in cloud revenue may keep Amazon’s stock under pressure until evidence emerges that AWS can regain growth momentum.