Amazon.com Inc. (NASDAQ:AMZN) is set to invest NZ$7.5 billion ($4.4 billion) in expanding its cloud computing infrastructure in New Zealand, marking a significant regional expansion.
AWS To Make New Zealand A Key Cloud Services Hub
The investment will transform New Zealand into a regional hub for Amazon Web Services, the company announced on Monday. The new AWS Region in New Zealand will allow local customers like Xero and Kiwibank to run artificial intelligence workloads, manage data, and provide digital services with greater efficiency.
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“The new AWS Region in New Zealand will help serve the growing demand for cloud services across the country and empower organizations of all sizes to accelerate their digital transformation,” said Prasad Kalyanaraman, vice president of infrastructure services at AWS.
The project is projected to generate more than 1,000 jobs and add around NZ$10.8 billion ($6.33 billion) to New Zealand's economy. It will run on renewable energy supplied by the country's largest wind farm, situated about 150 kilometers north of Wellington.
Amazon pours $50 Billion Into Asia-Pacific Digital Growth
Amazon is significantly increasing its investments in the Asia-Pacific, committing more than $50 billion to strengthen digital infrastructure across Australia, Japan, Singapore, Malaysia, and Thailand, according to Forbes.
The company’s investment in New Zealand follows a series of similar moves in the Asia Pacific region. In June, the tech giant announced a $13 billion investment to expand its data center infrastructure in Australia, marking the nation’s largest global technology investment in history.
This was followed by a $10 billion investment in North Carolina to support AI and cloud computing technologies.
AWS Slowdown Stems From Capacity Constraint, Not Demand Issues
Amazon's stock dropped after second-quarter earnings, but the slowdown in AWS was due to power-related capacity constraints, not weak demand, according to CEO Andy Jassy.
The company reported a record $195 billion backlog, up 25% year-over-year, highlighting strong demand that exceeds current capacity. CEO Jassy said the main constraint is power, along with challenges in chips and server components, and cautioned the shortage won't be resolved in just a few quarters.
Benzinga's Edge Rankings place Amazon in the 76th percentile for momentum and the 92nd percentile for growth, reflecting its strong performance in both areas. Check the detailed report here.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
