Amazon shares plunge as AI costs climb
The Hindu
Amazon shares dove more than 11 percent on Thursday as the computing and retail titan reported strong sales but significantly boosted spending estimates.
Amazon shares dove more than 11 percent on Thursday as the computing and retail titan reported strong sales but significantly boosted spending estimates.
Amazon reported a profit of $21.2 billion on net sales of $213.4 billion in the recently ended quarter as its AWS cloud computing, retail, advertising, and chips businesses thrived.
"With such strong demand for our existing offerings and seminal opportunities like AI, chips, robotics, and low-earth orbit satellites, we expect to invest about $200 billion in capital expenditures across Amazon in 2026," said Amazon chief executive Andy Jassy.
Market analysts had forecast that Amazon's capital expenditures would reach about $147 billion this year, mostly due to AI spending initiatives.
Amazon Web Services (AWS) unit sales in the quarter tallied $35.6 billion, a 24-percent jump from the same period a year earlier, according to earnings figures.
Like other tech giants, Amazon is making massive investments to grab a slice of the AI revolution pie.
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