Overview
- The stock has fallen roughly 20% to 25% from recent highs after the guidance, matching a nine‑day losing streak last seen in 2006 and erasing about $450 billion to $470 billion in market value.
- Amazon guided to roughly $200 billion of 2026 capital spending focused on data centers, custom chips, and AI infrastructure, exceeding many expectations by about $50 billion and stoking concerns about negative free cash flow next year.
- AWS remains a growth engine with about $35.6 billion in quarterly revenue and roughly $142 billion in annualized sales, with executives asserting demand will absorb new capacity.
- Analyst reactions are mixed as several firms cut near‑term targets or turned cautious on timing and cash flow, though buy ratings still dominate and technical indicators show the shares in oversold territory.
- Rival hyperscalers are also ramping outlays, with Microsoft reporting a 66% year‑over‑year increase in capex to about $37.5 billion, intensifying scrutiny of AI spending across big tech.