AWS runs on servers, electricity, and drives like the rest of the internet.

If your application and data are single-AZ it is not fault tolerant. If that datacenter goes down or the EBS volume fails, at the very least your application will have downtime.

EBS is replicated within the AZ but that is not guaranteeing you fault tolerance. You must take snapshots and store them across AZs, like any other mission critical S3 object.