By Hamza Faisal

Amazon chief executive Andy Jassy said on Friday that Amazon Web Services' cloud capacity is largely sold out through 2027, a blunt measure of how fast demand for artificial intelligence infrastructure is outrunning supply.

Speaking on a video podcast with Andreessen Horowitz co-founder Ben Horowitz and general partner Erik Torenberg, Jassy said the world's largest cloud provider is struggling to keep pace with what he described as insatiable demand from AI labs and enterprises. Capacity for 2026 is already gone, he said, and customer commitments are now stretching well into 2028.

"2027 is largely sold out. We always leave a certain amount for on demand and our inference service Bedrock, or EC2, but largely sold out all the big chunks. A good chunk of 2028 is sold out," Jassy said.

Demand that will not wait

The comments lay bare the central tension of the AI boom: the companies building and running AI models need enormous amounts of computing power, and the data centres to provide it cannot be built overnight. EC2, Amazon's service that rents out cloud servers, and Bedrock, which gives customers access to AI models to build applications, sit at the centre of that demand.

Jassy's remarks suggest the bottleneck is not willingness to spend but physical capacity. Power, chips, construction timelines and equipment lead times all limit how quickly new data centres can come online, even for a company of Amazon's scale. Customers, rather than waiting, are reserving capacity years in advance, locking in the large blocks Jassy referred to.

That advance booking also changes the competitive picture. With the biggest chunks of 2027 already spoken for, smaller AI labs and enterprises that did not reserve early may find themselves queuing behind larger customers or paying a premium for whatever on-demand capacity remains.

A $220 billion build-out

Amazon is already spending at a pace few companies can match. Earlier this year the company said it would spend about $220 billion on capital expenditure in 2026, much of it aimed at data centres and the infrastructure behind its cloud and AI businesses.

Jassy signalled that even that sum may not be the ceiling. The company "could invest a lot more and it wouldn't be a bad use of capital," he said, a remark that will hearten suppliers of chips, servers and power equipment while raising the stakes for rivals trying to keep up.

The spending race extends across the whole cloud industry, where Microsoft, Google and Meta are also pouring hundreds of billions of dollars into data centres. The question hanging over all of them is whether AI revenue will grow fast enough to justify the outlay, a debate that has intensified as valuations across the sector have climbed.

What investors will watch on October 29

Amazon is scheduled to report third-quarter results on October 29, and Jassy's capacity comments set the frame for that report. Investors will be watching for updated capital spending plans, any detail on how much of the 2027 and 2028 capacity is already contracted, and whether demand is still accelerating.

For now, the message from the top of Amazon is simple: the cloud is not running out of customers. It is running out of room.