Amazon's unstarted leases hit $165B as AWS backlog reaches $578B

Amazon's leases that are signed but not yet started rose to $164.9 billion at 30 September, up $27.7 billion in one quarter, while AWS's contracted backlog reached $578 billion, which means the landlords, builders and equipment makers behind AWS now hold years of signed work that pays out only as each building is handed over.

What happened?

• The print: Amazon reported third-quarter 2026 results on 29 October 2026, after the US close, and filed its Form 10-Q on 30 October. AWS sales were $46.0 billion, up 39% from a year earlier, its fastest growth in nearly five years. AWS operating income was $17.8 billion.
• The leases: Leases not yet commenced were $164.9 billion at 30 September, against $137.2 billion at 30 June. These are leases Amazon has signed for space or equipment it has not yet taken over, so they are not yet on the balance sheet.
• The equipment: For the first time Amazon listed property and equipment purchase commitments on their own line: $159.6 billion, of which $63.9 billion falls in 2027. In June these sat inside a single purchase obligations line of $130.1 billion.
• The backlog: AWS's commitments from customers not yet recognised as revenue were about $578 billion, up from about $496 billion at 30 June. The weighted-average remaining life of those contracts is 6.1 years.

Why does it matter?

The direct signal: AWS is selling capacity faster than it can build it. Chief executive Andy Jassy said on the call that AWS is installing an AI accelerator about every 14 seconds and that "almost as fast as we install capacity, customers are gobbling it up". He said the largest blocks, "hundreds of megawatts or sometimes up to a gigawatt", are reserved well in advance, and that AWS has very good visibility into 2027 and 2028 and some of 2029.

The second-order signal: the waiting moves to the suppliers. A lease that has not commenced is a promise of rent once a building is ready. A purchase commitment is a promise to pay once equipment arrives. Both sit with the companies that build, power and fit out data centers. Our arithmetic: of the $164.9 billion of unstarted leases, $114.8 billion, about 70%, is scheduled after 2030, and only about $15.0 billion falls before the end of 2027. The rent is long, but it starts late.

What Amazon does not say. The 10-Q does not split the unstarted leases by type. Amazon's lease note covers fulfillment network, data center, office and store buildings as well as server and networking equipment. Our inference, not Amazon's statement: with AWS property and equipment up by more than $120 billion since December, data center space is the likeliest driver of the jump. Our explainer on who builds AI data centers covers the developers and landlords that sign these leases.

Suppliers are also lending to Amazon. The 10-Q says some technology infrastructure orders carry payment terms of up to one year. Equipment Amazon has received but not yet paid for rose by $21.5 billion in the first nine months of 2026, against $4.8 billion a year earlier. Accounts payable reached $158.7 billion, from $121.9 billion at the end of 2025.

What does it change?

Near term (to the end of 2027)

• Equipment orders are front-loaded. Our arithmetic: $77.9 billion of the $159.6 billion of equipment commitments, about 49%, falls in the rest of 2026 and 2027. Amazon held its 2026 cash capital spending outlook at about $220 billion and said it expects to spend "meaningfully more" in 2027.
• AWS's asset base is growing at record speed. AWS property and equipment, net, was $313.0 billion at 30 September, up from $263.8 billion in June and $190.1 billion at the end of 2025. AWS added $57.1 billion of property and equipment in the quarter, about twice the $28.3 billion of a year earlier.
• Cash is going out first. Cash spent on property and equipment was $77.3 billion in the quarter, or $75.9 billion net of sales and incentives. Free cash flow for the 12 months to September was an outflow of $42.4 billion. Long-term debt reached $173.1 billion, from $65.6 billion at the end of 2025. See what free cash flow means for why AI spending has turned it negative.

Longer term (2028 and beyond)

• Backlog stretches the build. Our arithmetic: AWS's $578 billion backlog equals a little over three years of AWS sales at the third-quarter rate. Jassy said he expects AWS to grow by more than 40% in both 2027 and 2028. Our remaining performance obligation explainer sets out how this kind of backlog turns into revenue.
• Amazon's own chips leave AWS. Jassy said revenue commitments for Graviton, Amazon's server CPU, and Trainium, its AI accelerator, have each risen more than 20 times from a year earlier, and that Amazon intends to make Trainium available outside AWS late in 2027. That repeats the step Google took this quarter with TPU systems, and adds another buyer for leading-edge wafers, memory and packaging.
• Lease accounting will catch up. Each unstarted lease moves onto the balance sheet when Amazon takes the space. Our finance lease vs operating lease explainer shows how that changes the reported numbers.

What should we watch next?

• AWS re:Invent, 30 November to 4 December 2026, Las Vegas. Watch for Trainium generation and shipping dates, any detail on selling Trainium outside AWS, and new data center region announcements. It is on our Catalyst calendar.
• Nvidia's third-quarter fiscal 2027 results, 17 November at 2:00 pm Pacific time (06:00 Singapore time, 18 November). A read on whether AWS's accelerator installs show up in the largest GPU seller's numbers.
• Amazon's fourth-quarter results, early 2027. Watch whether unstarted leases keep rising or start converting into leases on the balance sheet, and what "meaningfully more" means for 2027 capital spending.
• What would weaken the catalyst: unstarted leases flattening while backlog keeps growing, which would point to a build bottleneck rather than demand; equipment commitments being cut back to minimum volumes; or customers trimming large reserved blocks of capacity.

FAQ

What is a lease that has not yet commenced?
It is a lease Amazon has signed for a building or equipment it does not yet control, often because the building is still under construction. It is disclosed in the notes but not recorded on the balance sheet until Amazon takes over the space.

Is all $164.9 billion for data centers?
Amazon does not say. Its leases also cover warehouses, offices, stores and equipment. The size and timing of the jump during the AI build make data centers the likeliest driver, but that is our inference.

What is AWS's $578 billion backlog?
It is the value of signed AWS customer contracts longer than one year that Amazon has not yet recognised as revenue. It turns into sales as customers use the capacity. See what Amazon does for how AWS fits Amazon's model.

Who waits on the money?
Developers and landlords wait for lease start dates, and equipment suppliers wait for delivery, with some giving Amazon up to a year to pay. The work is signed, but cash arrives in steps.

Takeaway: Amazon's $164.9 billion of unstarted leases and $578 billion AWS backlog show capacity sold years before it is built, with the landlords, builders and equipment makers behind AWS carrying the wait until each building is handed over.

References

1. Amazon.com, Inc., Form 10-Q for the quarter ended 30 September 2026, 30 Oct 2026.
2. Amazon.com, Amazon.com announces third quarter results, 29 Oct 2026.
3. Amazon.com, Inc., Form 10-Q for the quarter ended 30 June 2026, 31 Jul 2026.
4. Amazon, third-quarter 2026 earnings call transcript (Stock Analysis), 29 Oct 2026.
5. Amazon Web Services, AWS re:Invent 2026, accessed 30 Oct 2026.
6. Samsung Electronics, Samsung Electronics announces third quarter 2026 results, 29 Oct 2026.
7. CNBC, AI buildout hits snag as Google and Microsoft hold capex forecasts, 29 Oct 2026.
8. Bits & Bites, semiconductor news briefing: SK hynix says AI memory orders double supply; Google TPUs head to Oracle, 30 Oct 2026.
9. NVIDIA, NVIDIA sets conference call for third-quarter financial results, 28 Oct 2026.