Key Stats for Amazon Stock
- Pre-market price change for Amazon stock: -11%
- $AMZN Share Price as of Feb. 5: $223
- 52-Week High: $259
- $AMZN Stock Price Target: $296
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What Happened?
Amazon (AMZN) stock dropped over 10% after CEO Andy Jassy revealed the company plans to spend a staggering $200 billion on capital expenditures in 2026. That’s a massive jump from the $131 billion Amazon spent in 2025 and well above the $146.6 billion analysts were expecting.
The spending announcement overshadowed what were otherwise solid fourth-quarter results.
- Amazon posted $213.4 billion in revenue (beating estimates) and earnings of $1.95 per share, in line with consensus.
- Revenue from Amazon Web Services grew 24% year-over-year to $35.6 billion, marking AWS’s fastest growth in 13 quarters.
So why the huge spending increase? Jassy made it clear: AI demand is exploding, and Amazon is going all-in to capture it.
“We have very high demand,” Jassy told investors. “Customers really want AWS for core and AI workloads, and we’re monetizing capacity as fast as we can install it.”
The bulk of the $200 billion will go toward building AWS data centers and AI infrastructure.
Amazon is racing to keep up with competitors such as Google and Microsoft, which have also announced significant AI spending plans.
Google said it expects to spend up to $185 billion this year, while Meta could spend up to $135 billion.
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What the Market Is Telling Us About Amazon Stock
The sharp drop in Amazon stock suggests investors are concerned about the massive capital investment and its implications for near-term profitability.
While Jassy emphasized that Amazon expects “strong long-term return on invested capital,” Wall Street is clearly concerned about how quickly those returns will materialize.
Amazon’s AWS business is under pressure from fast-growing competitors.
- Microsoft’s Azure grew 39% last quarter, and Google Cloud jumped 48%—both outpacing AWS’s 24% growth.
- Amazon remains the overall cloud leader, but the gap is narrowing, which helps explain why the company feels it must invest so aggressively now.
The spending plan also comes amid major layoffs at Amazon.
The company announced 16,000 corporate job cuts last week, in addition to 14,000 in October. These moves suggest Amazon is trying to free up cash for AI investments by trimming expenses elsewhere.
For now, Amazon stock is taking a hit as investors digest the implications of this spending spree. But if Jassy’s bet on AI pays off, Amazon could emerge as the dominant force in cloud computing for years to come.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
