NEW YORK, March 26, 2026, 17:19 EDT
- Amazon slipped roughly 2% to $207.54 late, with the Nasdaq shedding 2.38% and officially landing in correction territory—a 10% or greater slide from its recent peak. Reuters
- On March 25, Citi, JPMorgan, and Tigress each bumped up their price targets for Amazon, citing a more bullish stance on the company’s cloud arm, Amazon Web Services. TipRanks
- Amazon is gearing up for $200 billion in capital expenditures in 2026, but new risks tied to its cloud operations and power supply are still front and center for the stock. Reuters
Amazon.com slipped roughly 2% in after-hours New York trade Thursday, landing at $207.54. Tech names broadly sold off, dragging the Nasdaq down 2.38%—now sitting 10.7% off its Oct. 29 record close. Reuters
This shift is significant: Amazon’s reputation isn’t just about e-commerce anymore. AWS—the cloud arm driving the company’s AI ambitions—generates just 15% to 20% of total sales, yet delivers over 60% of the operating profit, according to Reuters in February. Reuters
Wall Street sentiment has shifted. Citi bumped its price target to $285, up from $265, on Wednesday. JPMorgan hiked its own to $280, also previously at $265. Tigress Financial went further, lifting its target to $315 from $305. TD Cowen stuck with a buy and maintained its $300 call earlier this week. TipRanks
But that upbeat sentiment faces a critical hurdle: investor patience may wear thin. Back in February, Amazon projected its capital expenditures would jump to $200 billion in 2026—up sharply from $131 billion the year before. Wall Street didn’t like it. Shares fell 11.5% after the earnings release. “The market just dislikes” the relentless spending on data centers and AI infrastructure, Dave Wagner, a portfolio manager at Aptus Capital Advisors, told Reuters. Reuters
Chief Executive Andy Jassy insists the spending isn’t a choice—it’s required. Just last week, he said AI-driven demand could push AWS revenues to “at least double” his prior long-term forecast, with the cloud division’s outlook shifting rapidly. Reuters
Amazon is ramping up spending as it battles Microsoft and Alphabet for dominance in cloud and AI. AWS posted 24% revenue growth in the December quarter, while Google Cloud surged 48% and Microsoft’s Azure unit rose 39%, according to Reuters, citing Amazon’s 2026 spending outline. On Thursday, shares in Microsoft slipped about 1.4%, with Alphabet dropping 3.4%. Reuters
Citi on Wednesday bumped up its AWS forecasts, citing fresh revenue inputs tied to Anthropic, OpenAI, and core business lines. The bank now projects AWS will post 28% revenue growth in Q1, climbing to 29% by 2026. JPMorgan, in a separate note, pointed to “elevated” AWS demand and ongoing capacity buildout as reasons for its own target hike. TipRanks
Still, risks are clear. AWS disclosed on March 24 that its Bahrain region faced disruption from drone activity—marking the second cloud outage in a month tied to the Middle East war. Then, on Thursday, Reuters reported U.S. data-center power demand could jump more than fourfold by the end of the decade, putting extra pressure on the grid and on future expansion. Reuters
Broader market forces aren’t offering much relief. “It’s really the fog of war” pushing investors to the sidelines, Wells Fargo Investment Institute strategist Doug Beath said after Thursday’s sharp drop. Tech wasn’t in great shape to begin with, B. Riley’s Art Hogan noted, pointing to “AI CapEx concerns” weighing on the sector even before the latest conflict. Amazon, for its part, finds itself wedged between upbeat AWS guidance and a market still demanding faster evidence that its heavy spending pays off. Reuters
