Bernstein AWS Web Metrics Data: End of Q1 '26 Update and Early Q2 View
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Bernstein updated cloud spending trends using proprietary AWS Single Sign-On web metrics, noting that fourth-quarter 2025 indicators provided the strongest revenue signals since the pandemic. The data suggests first-quarter 2026 revenue for AWS and broader cloud infrastructure companies may accelerate. While the first quarter typically softens sequentially, metrics indicate potential quarter-over-quarter growth in the mid-to-high 2% range, translating to approximately 20% growth excluding artificial intelligence components.
Looking ahead to the second quarter, 2026 web metrics remain exceptionally strong, leading all post-pandemic periods and potentially driving an additional 100 basis points of acceleration. CIO surveys corroborate this optimism, showing the strongest IT budget growth expectations since 2018, primarily focused on cloud modernization.
Artificial intelligence revenue remains a critical growth driver. AWS AI services are currently running at an annualized rate exceeding $15 billion in the first quarter, while the semiconductor business, comprising Graviton and Trainium, is generating over $20 billion annually, reflecting triple-digit year-over-year growth. OpenAI and Anthropic have collectively secured seven gigawatts of future Trainium capacity, improving market sentiment around the chip initiative. Based on these signals, Bernstein maintains Outperform ratings on Amazon and Datadog, with target prices of $265 and $180 respectively. Twilio and Cloudflare retain Market-Perform ratings.