New York, February 5, 2026, 10:46 EST
- Amazon is set to release its fourth-quarter 2025 results on Thursday, with investors eyeing AWS growth and upcoming spending plans.
- Analysts are forecasting AWS revenue near $35 billion, marking roughly a 21% rise compared to the same period last year
- Investors are debating if Microsoft’s recent slowdown in Azure signals a wider slump in the cloud sector
Amazon.com is set to release its earnings later Thursday, with investors closely watching Amazon Web Services following Microsoft’s sharp retreat, which reignited concerns about a broader cloud slowdown. Since Microsoft’s January 28 report, its shares have dropped 14%, erasing over $500 billion in market value. Catalyst Funds CIO David Miller warned, “If it’s the latter, that could carry over.” (Advisor Perspectives)
Big Tech faces tricky timing. Cloud growth was meant to fund the push into generative AI, yet costs for new data centers and chips keep climbing. Investors are starting to question the returns.
Amazon doesn’t have as much margin for error as before. Over the past year, its shares have lagged behind several mega-cap rivals, and investors have been swift to react negatively to any signs of weakening demand.
Amazon projects net sales between $206 billion and $213 billion for the upcoming quarter, boosted by a roughly 1.9 percentage-point gain from foreign exchange, according to a Zacks note cited by Nasdaq. Zacks also estimates fourth-quarter AWS revenue at $35.02 billion, with capital expenditures around $125 billion for 2025, expecting them to rise in 2026. (Nasdaq)
According to Business Insider, Wall Street expects Amazon’s total revenue to hit $211.49 billion, with earnings per share (EPS) at $1.96. AWS net sales are projected at $34.88 billion. Bank of America’s Justin Post is slightly more optimistic, forecasting 22% year-over-year growth for AWS—citing increased capacity fueling extra sales—compared to the Street’s 21% estimate.
Investors will also be watching closely for clues about Amazon’s pace of spending on AI infrastructure—and how much of that cost it can swallow without hurting margins. Capital expenditure, or capex, refers to the funds companies shell out for long-term assets like data centers, servers, and networking equipment.
Peers are making waves. Alphabet announced Wednesday it plans to spend between $175 billion and $185 billion in 2026—almost twice its 2025 outlay—as Google Cloud revenue jumped 48% to $17.7 billion in the December quarter. CEO Sundar Pichai told analysts, “We are seeing our AI investments and infrastructure drive revenue and growth across the board.” (Reuters)
Amazon’s cloud report drops into a tighter race. Microsoft’s Azure and Google Cloud are both ramping up efforts to grab more market share, while Oracle is pushing its cloud growth pitch to clients developing AI systems.
Retail still plays a role, even as AWS drives most of Amazon’s growth. Analysts forecast that Amazon’s physical store revenue—which covers Whole Foods, Amazon Fresh, and Amazon Go—will climb 5.4% to $5.9 billion, according to LSEG estimates. The company is also launching a new 225,000-square-foot grocery “mega-store” near Chicago aimed at taking on Walmart and Costco shoppers. S&P Global analyst Bea Chiem noted, “I think to go all-in on brick-and-mortar is probably not the long-term strategy for Amazon.” (Reuters)
The cloud figure could make or break the session. Should AWS growth disappoint, or if Amazon warns of faster spending increases than anticipated, gains in e-commerce and advertising might not hold the stock up.
