New York, February 6, 2026, 13:34 EST — Regular session
Shares of Amazon.com (AMZN.O) dropped 6.3% to $208.58 in early afternoon trading on Friday, hitting a low of $200.44 during the session.
The selloff came after Amazon revealed plans for about $200 billion in capital expenditure, or capex — funds for data centers and equipment — in 2026. That’s a jump of more than 50% from last year as the company ramps up AI infrastructure. The figure matters because investors are wary about when AI spending will start delivering cash returns, not just bigger server farms. CEO Andy Jassy told analysts “AWS is a much larger business,” defending Amazon Web Services’ 24% revenue growth. AJ Bell’s investment director Russ Mould noted traders are pulling back from stocks where “positive surprises may be hard to achieve.” 1
The broader market climbed, led by a chip sector rebound following this week’s tech sell-off, though nerves remained over the largest AI budgets. “We’re going to continue to see these ebbs and flows,” said Ben Falcone, managing director at Kayne Anderson Rudnick, highlighting the push-pull between short-term spending strains and potential long-term gains. 2
On the Street, a few brokerages stayed bullish on Amazon but lowered their price targets, citing a ramp-up in capex that might squeeze free cash flow — the money left after costs and investments — and keep investors wary of short-term margin hits. Some analysts noted the expectations have shifted: spending is baked in, and now the market wants clearer evidence of returns. 3
The unease isn’t just hitting megacaps. Since January 28, the S&P 500 software and services index has lost roughly $1 trillion in market value. Investors are wrestling with whether rapidly advancing AI tools will undercut demand for existing software offerings. 4
For Amazon, the issue now is less about if, and more about when. Boosting capex could drive sales growth down the line, but if demand or pricing falters, margins might take a hit.
The risk here is a slow payoff: Amazon might be stuck footing the bill for capacity it can’t monetize fast enough. Investors haven’t forgotten past tech booms where infrastructure outpaced revenue. Friday’s action made clear they’re still on board with the AI narrative — but now they demand numbers, not just faith.
February 13 marks a key macro moment with the release of January’s consumer price index at 8:30 a.m. ET, a data point known for rattling rate expectations and tech stock valuations. For Amazon, the spotlight will be on any updates regarding AWS demand and spending discipline—traders will eye those details as the next big catalyst. 5
