Amazon Web Services Pauses Data Centre Leasing Talks Amid Hyperscale Slowdown

Amazon Web Services (AWS) has reportedly put a hold on parts of its colocation leasing negotiations, reflecting a broader deceleration in hyperscale activity, according to a recent update from Wells Fargo.

The investment firm noted that AWS's decision appears to follow a similar trend by Microsoft (NASDAQ: MSFT), another major player in the cloud infrastructure and data centre space. According to Wells Fargo analysts, multiple industry sources over the weekend indicated that AWS has paused a portion of its colocation leasing efforts—particularly those involving international sites.

Pause Driven by Recent Leasing Surge, Not Cancellations

While the exact scale of the pause is unclear, analysts emphasised that AWS is currently absorbing the impact of several large, recently finalised leasing agreements. Crucially, the pause applies only to new negotiations; existing contracts remain intact.

Wells Fargo highlighted that both AWS and Microsoft are experiencing a near-term moderation in hyperscale leasing activity. This trend points to a temporary reassessment in cloud infrastructure expansion by two of the sector’s largest players.

Other Hyperscalers Remain Active in Data Centre Expansion

Despite the slowdown from AWS and Microsoft, demand across the broader hyperscale landscape remains robust. Wells Fargo noted that companies such as Meta, Google (NASDAQ: GOOGL), Oracle (NYSE: ORCL), and NVIDIA (NASDAQ: NVDA) continue to pursue aggressive data centre expansion strategies.

One key driver of continued activity is the expansion of Project Stargate—a joint initiative between OpenAI and Oracle—which is contributing to elevated leasing volumes in the sector.

AWS Power Capacity and Growth Outlook

Currently, AWS operates more than 9 gigawatts (GWs) of active power capacity across its global data centre portfolio. Of that, around 70% is self-built, with approximately 2.5 GWs sourced through third-party colocation providers. Long-term, AWS aims to scale its self-built capacity to a potential 23 GWs, according to the report.

Temporary Pause Not Unusual in the Cloud Industry

Wells Fargo pointed out that temporary pauses in leasing activity are not uncommon in the hyperscale market. These so-called “digestion” phases typically last between 6 and 12 months, though some resolve more quickly. As an example, Google significantly reduced its leasing activity in late 2024 but ramped up again by early 2025.

(Sources: investing.com, reuters.com)