Key Takeaways
- Amazon is reportedly in talks to move about $8 billion of Nvidia chips into an investor-funded vehicle and lease them back, according to the Financial Times.
- Free cash flow was negative $18.17 billion in Q1 2026 and negative $8.82 billion in Q2, a combined outflow of $26.99 billion in six months.
- The reported deal would offset less than a third of that first-half outflow and roughly 4% of the $220 billion 2026 capex plan, by this calculation.
Free cash flow swung to negative $26.99 billion in the first half of 2026 as capex climbed. See every quarter. Track AMZN free cash flow on TIKR for free →
Amazon Stock’s Chip Leaseback Plan Follows a Deep Cash Drain
Amazon (AMZN) spent $53.1 billion on cash capital expenditures in the second quarter of 2026. On the Q2 earnings call, CEO Andy Jassy said full-year spending would reach about $220 billion, up from a prior estimate of $200 billion as memory costs rose. Two months later, the Financial Times reported that Amazon is seeking to offload about $8 billion of Grace Blackwell chips into a special-purpose vehicle funded by outside investors, then lease them back.
Using TIKR’s operating-cash-flow-minus-capex measure, free cash flow was negative $18.17 billion in Q1 2026 and negative $8.82 billion in Q2. This measure excludes proceeds from property and equipment sales and incentives, which Amazon includes in its reported free cash flow.
Over the last four quarters, it totaled negative $11.62 billion, compared with positive $13.48 billion in the four quarters before. The fourth quarter is usually Amazon’s strongest, with $14.94 billion in Q4 2025, but that seasonal lift no longer covers the spending.
An $8 Billion Leaseback Signals Funding Pressure More Than It Solves It
Jassy framed the drain as temporary. Data centers absorb capital two years before servers go in, and servers break even in “a little less than 3 years,” he said, before generating significant free cash flow. Demand supports the bet: AWS revenue grew 36.7% in Q2, and its backlog stands at $496 billion.
The judgment is that the strategy holds up, but the timing gap is real, and the reported chip sale shows Amazon looking beyond its own cash flow to fund it. CEO Andy Jassy said Amazon has “a lot of options” to fund AWS growth and noted that it had already issued debt this year. A leaseback adds another option, but it turns an owned asset into a recurring lease cost.
Third-quarter results will show whether free cash flow improves from the negative $8.82 billion Q2 level. A third straight negative quarter would show that the cash-flow shortfall persists; a larger outflow than Q2 would indicate that it is widening.
A third straight negative quarter would show the funding gap widening. Follow the next report closely. Build an AMZN watchlist on TIKR for free →
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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 of the stocks mentioned. Thank you for reading, and happy investing!
