Here’s what to watch for during Amazon’s Q1 2024 earnings report tomorrow as AWS eyes a $100 billion run rate potentially driven by AI.

Amazon will report first quarter 2024 financial earnings results on Tuesday with all eyes on its $97 billion cloud business, Amazon Web Services, as the cloud giant eyes a record $100 billion annual run rate.

The Seattle-based worldwide cloud leader currently owns 32 percent market share as it’s seeking to secure its grasps on the red-hot AI and generative AI market with competitors Google and Microsoft nipping at its heels.

AWS earnings results for Q1 2024 will take place April 30 at 5:30 p.m. ET. Here are some major things channel partners, investors and customers should know ahead of Amazon’s earnings report tomorrow.

Zacks Consensus Estimate For AWS Sales: $24.26 Billion

AWS generated sales of $24.2 billion during its most recent fourth quarter 2023. This represented a 13 percent year-over-year increase in AWS revenue compared to $21.4 billion in Q4 2022.

[Related: AWS Confirms ‘Several Hundred’ Layoffs In Sales, Marketing, Global Services Teams]

Zacks consensus estimate is predicting that AWS captured $24.26 billion in revenue during the first quarter 2024.

If correct, this means AWS increased sales by nearly 14 percent year over year compared to the $21.35 billion AWS generated in Q1 2023.

Will AWS Cross $100 Billion Annual Run Rate Mark?

Parent company Amazon has been pouring billions of dollars into expanding AWS cloud regions and availability zones to increase AWS customer base. These data center investments are being made both inside the U.S. and abroad, which are expected to have helped AWS with new customer dollars.

If AWS generated roughly $24.26 billion in revenue, as Zacks expects, the company will be on a roughly $97 billion run rate.

This would mean AWS will miss the $100 billion annual run rate threshold by about $3 billion.

However, if AWS beats Zacks estimates by about $700 million, and reports $25 billion in total Q1 2024 sales, it will become a $100 billion cloud company.

AWS Layoffs

This month, Amazon said it was cutting hundreds of AWS employees in marketing, sales and global service organizations as part of a strategic shift.

Most of the layoffs were related to changes in AWS training and certification programs as well as sales operations. AWS is shifting toward more digital training and training programs run by external partners, with a new focus on self-serve training.

“Within our training and certification organization, we have evolved our strategy to prioritize investing in self-serve digital training and delivering instructor-led training through AWS Training Partners,” an AWS spokesperson told CRN.

AWS does not provide data about its global employee headcount, other than confirming it has tens of thousands of AWS employees.

Partners, investors and customers should take note if AWS talks about these layoffs and if executives say more AWS employee cuts are expected in 2024.

AWS, like fellow competitors Google and Microsoft, has invested millions into launching new AI and generative AI technologies.

The goal is to capture more customer mindshare with new AI features into AWS flagship cloud platform as well as new AI platforms such as Amazon Bedrock. AWS is also expanding partnerships with AI superstars like Nvidia and startups such as Anthropic.

It will be interesting to see if Amazon provides the public an AI sales or data figure in terms of how much revenue AI is driving for AWS. AI-related sales growth is key for AWS, Google and Microsoft to win over customers seeking to leverage the best AI for business transformation.

AWS does have the ability to throw down the gauntlet in terms of unveiling AI-related sales as both Google and Microsoft have shied away from providing figures.