Amazon Web Services customers looked to cost savings within their cloud spending amid economic turbulence in the first quarter.

“Our AWS sales and support teams continue to spend much of their time helping customers optimize their AWS spend so that they can better weather this uncertain economy,” Chief Financial Officer Brian Olsavsky said Thursday during Amazon’s Q1 earnings call.

For example, AWS operating income fell 22% year over year to $5.1 billion, according to Amazon’s earnings supplement.

Although AWS income is down and customers are more cautious with expenses, the tech giant is helping clients mitigate spending with long-term relationships in mind, Chief Executive Andy Jassy said in the supplement. For example, Amazon is helping clients save money through its technologies, including large language models, generative AI and machine learning.

“It’s important to remember that customers are pretty explicitly telling us that this is not a cost-cutting effort where we intend on spending less money on technology or on the cloud,” Jassy said during the call. “This is our reprioritizing what matters most to our business.”

As AWS customers looked to cut costs, Amazon, too, decided to eliminate 9,000 jobs, impacting AWS teams, Olsavsky added. The cuts follow a pattern of layoffs Amazon has executed since December.

Tech spend continues

During the quarter, the tech giant continued to invest in technology as operating expenses grew 8% YoY to $122.6 billion, according to the earnings supplement. Within operating expenses, technology and content expenses jumped 39% YoY to $20.5 billion.

Additionally, Amazon announced new AWS tools in the quarter focused on AI, according to the earnings supplement. For example, the company introduced Amazon Bedrock, which allows clients to build and scale generative AI applications.

Client wins

While clients pulled back cloud spending, AWS gained two financial institution clients during the quarter, according to the earnings supplement. BBVA will use AWS cloud services to launch new solutions for its BBVA Corporate and Investment Banking business.

Australia-based Westpac also renewed its agreement with AWS in Q1, allowing the bank to use the cloud provider’s machine learning and data analytics capabilities, according to the supplement.

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