Following are the different types of instances:

General Purpose Instance type
General purpose instances are the instances mainly used by the companies. There are two types of General Purpose instances: Fixed performance (eg. M3 and M4) and Burstable performance (eg. T2). Some of the sectors use this instance such as Development environments, build servers, code repositories, low traffic websites and web applications, micro-services, etc.

Following are the General Purpose Instances:
T2 instances: T2 instances are the instances that receive CPU credits when they are sitting idle and they use the CPU credits when they are active. These instances do not use the CPU very consistently, but it has the ability to burst to a higher level when required by the workload.
M4 instances: M4 instances are the latest version of General purpose instances. These instances are the best choice for managing memory and network resources. They are mainly used for the applications where demand for the micro-servers is high.
M3 instances: M3 instance is a prior version of M4. M4 instance is mainly used for data processing tasks which require additional memory, caching fleets, running backend servers for SAP and other enterprise applications.
Compute Optimized Instance type
Compute Optimized Instance type consists of two instance types: C4 and C3.
C3 instance: C3 instances are mainly used for those applications which require very high CPU usage. These instances are mainly recommended for those applications that require high computing power as these instances offer high performing processors.
C4 instance: C4 instance is the next version of C3 instance. C4 instance is mainly used for those applications that require high computing power. It consists of Intel E5-2666 v3 processor and use Hardware virtualization. According to the AWS specifications, C4 instances can run at a speed of 2.9 GHz, and can reach to a clock speed of 3.5 GHz.
GPU Instances
GPU instances consist of G2 instances which are mainly used for gaming applications that require heavy graphics and 3D application data streaming. It consists of a high-performance NVIDIA GPU which is suitable for audio, video, 3D imaging, and graphics streaming kinds of applications. To run the GPU instances, NVIDIA drivers must be installed.
Memory Optimized Instances
Memory Optimized Instances consists of R3 instances which are designed for memory- intensive applications. R3 instance consists of latest Intel Xeon lvy Bridge processor. R3 instance can sustain a memory bandwidth of 63000 MB/sec. R3 instance offers a high- performance databases, In memory analytics, and distributed memory caches.
Storage Optimized Instances
Storage Optimized Instances consist of two types of instances: I2 and D2 instances.
I2 instance: It provides heavy SSD which is required for the sequential read, and write access to a large data sets. It also provides random I/O operations to your applications. It is best suited for the applications such as high-frequency online transaction processing systems, relational databases, NoSQL databases, Cache for in-memory databases, Data warehousing applications and Low latency Ad- Tech serving applications.
D2 instance: D2 instance is a dense storage instance which consists of a high-frequency Intel Xeon E5-2676v3 processors, HDD storage, High disk throughput.