Amazon misses on earnings and holds capex steady, adding to AI spending jitters
AWS revenue rose 39% as Amazon kept full-year capital spending at $220 billion, easing some growth concerns despite a profit miss.
- On Thursday, Amazon reported third-quarter results revealing a negative free cash flow of $42.4 billion for the trailing 12 months while maintaining its $220 billion capital expenditure forecast for 2026.
- Massive spending on AI infrastructure and data centers has eroded cash flow as Amazon prioritizes aggressive capacity expansion to meet surging demand for AI computing power in the global race.
- Amazon Web Services revenue climbed 39% to $46 billion, marking its fastest growth in nearly five years, while retail online sales rose only 2% year over year to $68.47 billion.
- Investors drove shares down nearly 7% in extended trading following the results, reacting to Amazon's fourth-quarter revenue guidance of $240 billion to $247 billion, signaling holiday season retail concerns.
- Analysts expect capital expenditures to exceed $280 billion in 2027, as CEO Andy Jassy confirmed cloud capacity is "largely sold out" for next year amid the intensifying AI infrastructure race.
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78 Articles
Amazon Web Services revenues increased by 39%, to 46 billion dollars, in the third quarter
Reformatorisch Dagblad
Technology and e-commerce giant Amazon achieved higher revenue and profit in the third quarter with its cloud division. Demand for computing power and server storage space is growing rapidly due to the rapid development of artificial intelligence, and Amazon is the world's largest supplier of this. At the same time, Amazon's expenses rose sharply.
Amazon is not only the world's largest online retailer, but also a leading player in cloud services. In the AI boom, this ensures growth - but also brings high costs for new data centers.
(San Francisco = Yonhap News) Correspondent Kwon Young-jeon = As Amazon, the world's largest cloud and e-commerce company, released earnings and outlooks that fell short of market expectations, its stock price surged...
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