New York, Feb 6, 2026, 16:02 EST — After-hours
- Amazon shares extend a post-earnings slide after the company flagged roughly $200 billion in 2026 capital spending, largely tied to AI and cloud buildout. 1
- Traders are testing whether Big Tech’s rising AI spend can translate into cash returns, after a sharp rotation in tech and software names. 2
- The next Amazon earnings update is expected on April 30. 3
Amazon.com Inc (AMZN) shares were down about 6% on Friday, as investors weighed a step-up in capital expenditures — spending on items such as data centers, servers and equipment — aimed at expanding artificial-intelligence capacity. The stock was last off 6.2% at $208.93, after trading as low as $200.44.
The move comes as Wall Street turns more sensitive to the price tag of the AI buildout. The top “hyperscalers” — large cloud providers — are expected to spend more than $630 billion this year on data centers and AI chips, and some investors have started drawing uneasy parallels to the early-2000s infrastructure boom. MoffettNathanson analysts wrote that the direction was not a surprise, but the magnitude was “materially greater than consensus expected,” while AJ Bell investment director Russ Mould said the market was shifting away from stocks “where positive surprises may be hard to achieve.” 4
The selling gathered pace a day earlier. Amazon projected about $200 billion of capital spending for 2026, up from $131 billion in 2025, and the shares fell 11.5% in after-hours trading after closing down 4.4% in the regular session. “The market just dislikes the substantial amount of money that keeps getting put into capex for these growth rates,” said Dave Wagner, portfolio manager at Aptus Capital Advisors, as cloud rivals highlighted faster growth rates in their own results. 5
Amazon’s earnings update gave investors plenty to argue over. The company said fourth-quarter net sales rose 14% to $213.4 billion, with AWS revenue up 24% to $35.6 billion and advertising services revenue up 23% to $21.3 billion. Chief Executive Andy Jassy said Amazon expects to invest about $200 billion in capital expenditures in 2026 and anticipates a “strong long-term return on invested capital.” For the first quarter, Amazon forecast net sales of $173.5 billion to $178.5 billion and operating income of $16.5 billion to $21.5 billion; it also said trailing-12-month free cash flow — cash from operations less purchases of property and equipment — fell to $11.2 billion. 6
On the conference call, Jassy told analysts most of the planned spending would land in AWS because “we have very high demand,” adding: “We’re monetizing capacity as fast as we can install it.” Sky Canaves, a principal analyst at EMARKETER, said Amazon’s core retail business held up in the holiday quarter and that its AI shopping assistant Rufus “is gaining traction and driving more sales among users.” 7
Analyst notes added to the pressure on Friday. DA Davidson downgraded Amazon to Neutral from Buy and cut its price target to $175, saying AWS appeared to be “scrambling to catch up through escalating investment” as competition intensified, and flagging risks to the retail business from a “chat-driven” shift in online shopping. 8
The broader tape did not look risk-off. The S&P 500’s SPDR ETF (SPY) was up about 2.1% and the Nasdaq 100’s QQQ was up about 2.3%, leaving Amazon as a notable drag among large-cap tech after a strong day for the major indexes.
But the uncertainty is straightforward: spending is easy to announce, and harder to prove out. If AI demand or pricing fails to keep pace, heavier capex can squeeze cash generation and leave less room for mistakes, even if revenue growth holds up.
Investors now look to whether the stock stabilizes into Monday’s session and whether estimates keep moving as analysts update models around AWS capacity and cash returns. The next clear marker is Amazon’s first-quarter report, expected on April 30, when investors will press for sharper timing on payback from the spending wave. 9
