AI Models Send Up to 40% of Revenue to Cloud Giants, Barclays Says

According to Jin10, Barclays said in a research report on the AI industry that for every $100 in revenue earned by AI model companies, about $35 to $40 flows to the three major cloud giants in the form of inference computing costs: Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP). Cloud providers can earn about $10 to $20 in operating profit from this, corresponding to operating margins as high as 35% to 45%. Meanwhile, the profit margin of paid inference businesses at AI labs has risen sharply, from low double digits in 2025 to 50% to 65% or even higher in 2026, while adjusted gross margins have increased by 30 to 50 percentage points year on year. Barclays analysts said actual profit margins may be higher than the report's estimates, but margins are expected to gradually decline as competition among frontier models intensifies and computing supply continues to increase.