Amazon and Microsoft close the market value gap amid AI and cloud race

Amazon’s market value nears Microsoft’s as their race in cloud services and artificial intelligence heats up, challenging the longstanding dominance of the technology giants.

Amazon and Microsoft are moving towards each other in market value, but the race now looks less one-sided than it did earlier this year. Amazon’s shares are up about 6% in 2026, while Microsoft has fallen roughly 22%, narrowing the gap between the two technology giants to the point where a change at the top no longer looks far-fetched.

Amazon’s market value now stands at about $2.6 trillion, with Microsoft at roughly $2.8 trillion. On paper, that still leaves Microsoft closer to a return to the $3 trillion club, alongside three other members of the “Magnificent Seven”. Yet the argument for Amazon overtaking it first rests on momentum as much as arithmetic, with investor sentiment increasingly tied to the differing strengths and vulnerabilities of each company.

The contrast is especially sharp in cloud computing and artificial intelligence. Amazon Web Services remains Amazon’s profit engine, and Statista has shown that AWS accounted for 21% of Amazon’s sales in the first quarter of 2026 while contributing 59% of operating profit. That relationship has long given Amazon the financial firepower to support its retail and logistics businesses, even as competition intensifies. Microsoft, meanwhile, has benefited from strong revenue growth, but its early lead in AI, helped by its alliance with OpenAI, now looks less secure as rivals including Anthropic and Google’s Gemini push harder into the same terrain.

Both companies are spending heavily to keep pace. Tom’s Hardware reported in April that combined capital expenditure plans among major technology groups were set to surge this year as AI infrastructure demand accelerates. But the burden of that investment race may weigh differently on each business. AWS has recently faced margin pressure as the AI build-out drove higher spending, according to GeekWire, while Microsoft’s software franchises such as Windows and Office are facing fresh questions about their long-term role in an AI-shaped market. In that context, Amazon’s broader business mix may offer more insulation than it once did, making a $3 trillion valuation by late summer look ambitious but not impossible.

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Source: Fuse Wire Services