New York, Feb 6, 2026, 09:50 EST — Regular session
- Amazon shares dropped roughly 9% in early trading following an updated forecast for 2026 capital expenditures.
- CEO Andy Jassy pointed to roughly $200 billion in capex as Amazon accelerates its AI and cloud expansion.
- Investors are weighing AWS’s growth against a steeper blow to cash flow.
Amazon.com Inc shares dropped sharply in early trading Friday following the release of a roughly $200 billion capital expenditure plan for 2026. Investors fretted that the AI spending spree in Big Tech is growing more costly before turning a profit. The stock tumbled 8.8% to $203.15, down from Thursday’s close at $222.69. 1
Spending plans are taking center stage in mega-cap tech, overtaking earnings beats and misses as the main focus. Capital expenditures, or capex, cover investments in data centers, servers, and other gear that fuels cloud services and AI — though they also tighten near-term cash flow.
Investor nerves are fraying over the rising costs tied to AI infrastructure. Amazon’s stock slid 8% in premarket, following its latest spending plan that fueled concerns about a sector-wide bill Reuters estimates could exceed $600 billion this year. Alphabet, Meta, and Microsoft are also accelerating their investments. Analysts at MoffettNathanson noted the spending “is materially greater than consensus expected.” Still, CEO Andy Jassy pushed back, highlighting AWS’s “24% year-over-year growth on $142 billion annualized run rate” as a key difference. 2
Amazon announced late Thursday plans to spend roughly $200 billion on capital expenditures in 2026, aiming for “strong long-term return on invested capital.” Free cash flow dipped to $11.2 billion over the past year as property and equipment purchases surged. Still, fourth-quarter net sales climbed 14% to $213.4 billion, with AWS revenue up 24% at $35.6 billion. The company projects first-quarter operating income between $16.5 billion and $21.5 billion. 3
Amazon filed its quarterly results release with the U.S. Securities and Exchange Commission on a Form 8-K, signed off by CFO Brian Olsavsky. The submission also included extra details on non-GAAP measures. 4
The broader market kicked off higher following a tough week for tech stocks. The Dow, S&P 500, and Nasdaq all started the session in the green, though Amazon’s decline weighed on sector sentiment. 5
Traders are closely monitoring if the selloff spills over to other cloud stocks, and how fast AWS demand translates into revenue growth that supports its increased spending pace. Amazon has doubled down on its own chips and AI tech, yet the market remains skeptical, viewing it as a “show me” scenario rather than a win.
But the risk is clear: if AI demand slows or prices drop, the fresh buildout might lead to steeper depreciation and tighter margins, especially with competitors ramping up their spending. A small hiccup in cloud growth will feel magnified as capital expenses climb.
Wall Street’s mood is shifting. DA Davidson downgraded Amazon from buy to neutral, slashing its price target to $175. Analyst Gil Luria says the company is “losing the lead” in cloud computing. 6
Investors are turning their attention to macro data that could shift risk appetite for tech: the U.S. January jobs report, delayed by a short government shutdown, is now set for release on Feb. 11. 7
