What happened
Andy Jassy said AWS can grow north of 40% in 2027 and 2028 and become a trillion-dollar revenue business in 5 to 10 years; Elon Musk said SpaceX could reach a $500b to $1t annual recurring revenue run rate by 2027.
Why it matters
Both CEOs are betting their companies can build a $1t AI compute engine before AI erodes the legacy cash cow paying for the GPUs.
Summaries like this, every morning.
The two $1t targets come as growth rates are accelerating at every hyperscaler on businesses generating $30b to $50b per quarter. The market sold off two of the three hyperscalers on earnings day, reflecting investor worry that legacy businesses will not sustain positive cash flows to fund capex in time to realize ROI. Google's Search & other advertising growth slowed to 12% ($63.3b) from 19% in Q1 and 17% in Q2, as AI Mode monetizes at a lower rate than classic ten-blue-link search. Amazon faces a similar question over whether external shopping agents bypass the search results pages where Amazon Ads generates $19.6b per quarter, though Jassy said few customers shop this way yet. Microsoft is the only hyperscaler whose legacy enterprise franchise is expanding ARPU through AI faster than seat growth is slowing, while ServiceNow's market cap fell 29% on fears of AI erosion of its core seat-based business. The first $10t company will be the one whose new compute engine reaches $1t before its old monopoly pays the tab.
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