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

Amazon will report first quarter 2026 financial earnings on Wednesday. Here are five key things to know and watch for during Amazon’s earnings report around AWS sales, its new Anthropic deal and the impact of the war in the Middle East.

Will Amazon CEO Andy Jassy discuss the recent drone attacks on its Amazon Web Services data centers in the Middle East?

Just how much does Wall Street expect AWS revenue to grow in the first quarter of 2026?

What will Amazon executives highlight regarding its massive new Anthropic deal?

These questions will hopefully be answered during Amazon’s first quarter 2026 earnings report set for April 29. CRN breaks down the five biggest things to watch for during Amazon’s Q1 2026 financial earnings results on Wednesday.

AWS Q1 2026 Expected Sales Growth: 26 Percent

AWS is Amazon’s main profit driver, accounting for a whopping 57 percent of Amazon’s operating income in 2025. AWS sales growth is critical to its parent company’s future.

Wall Street analysts are forecasting that AWS will report total sales growth of 26 percent year over year for Q1 2026 to around $36.8 billion.

This would be greater growth for AWS on both a concurrent and year-over-year basis.

During Amazon’s recent fourth quarter 2025, AWS captured $35.6 billion in revenue, up 24 percent year over year.

One year ago in its first-quarter 2025, AWS generated $29.3 billion in revenue, up 17 percent year over year.

However, some analysts, like UBS’ Stephen Ju, expect AWS to report upwards of 38 percent sales growth year over year for Q1 2026.

What To Watch For: If Wall Street is correct and AWS reports 26 percent growth year over year, it shows that the world’s largest cloud company can still grow revenue meaningfully on top of an already significant figure.

Middle East Conflict Affecting AWS Data Centers

When the war broke out in the Middle East between the United States, Israel and Iran, AWS data centers may not have been top of mind in the discussion.

However, several AWS data centers in the Middle East were hit by drone strikes in early March as the war began, which knocked out power in AWS facilities in the United ⁠Arab Emirates and Bahrain.

“These strikes have caused structural damage, disrupted power delivery to our infrastructure, and in some cases required fire suppression activities that resulted in additional water damage,” AWS said in early March.

Weeks later, AWS’ data centers in the region were disrupted once again by ongoing drone activity that impacted Amazon infrastructure. This forced AWS customers to move workloads to other Amazon data centers.

What To Watch For: Geopolitical matters are rarely ever discussed in technology firms’ financial earnings reports. However, with the war in the Middle East still raging on—including potential energy and fuel issues—watch to see if Amazon execs explain their security and data center strategy in the region and if any more disruptions are expected.

Anthropic’s $100 Billion Bet On AWS

Last week, Amazon struck a deal with Anthropic that guarantees Amazon $100 billion in revenue over the next 10 years for providing massive computing capacity.

The deal includes current and future generations of Trainium, which is Amazon’s custom silicon, and tens of millions of Amazon’s CPU Graviton cores. Anthropic will secure up to 5 gigawatts (GW) of capacity to train and power their advanced AI models.

AWS customers will be able to access the full Anthropic-native Claude console from within AWS.

Separately, Amazon will invest $5 billion in Anthropic and up to an additional $20 billion in the future tied to certain commercial milestones. This is in addition to the $8 billion Amazon previously invested in Anthropic.

What To Watch For: If Andy Jassy weighs in on this new partnership and what Amazon’s additional $20 billion investment in the future is tied to.

Google’s New Anthropic Partnership And Q1 Earnings

Just a few days ago, Google confirmed plans to invest up to $40 billion in Anthropic.

The pact involves an initial $10 billion from Google with the remaining $30 billion tied to certain performance milestones.

Prior to this announcement, Google’s investment in Anthropic was already over $3 billion, owning a 14 percent stake in the company.

Earlier this month, Anthropic also secured 5 gigawatts of computing capacity with Google and Broadcom that will come online next year.

What To Watch For: Anthropic’s new deals this month with both Google and Amazon are very similar. It will be interesting to hear what Amazon executives say about Anthropic, specifically if questions arise around Anthropic’s partnership with AWS rival Google Cloud. Google is also set to report its Q1 2026 financial results on Wednesday, April 29.

Is Amazon’s $200 Billion CapEx 2026 Investment Still On Track?

Amazon unveiled plans this year to invest $200 billion in capital expenditures, predominantly in AWS and data centers.

“We have deep experience understanding demand signals in the AWS business and then turning that capacity into strong return on invested capital. We’re confident this will be the case here as well,” said Jassy in February. “We just have a lot of growth and a lot of demand.”

What To Watch For: Watch closely for Amazon’s guidance for its current quarter Q2 2026 and what it will say about its $200 billion capex investment. With increasing energy prices and the current geopolitical climate, it will be interesting to see if Amazon maintains its $200 billion CapEx spending plan.