Amazon Shares Decline Following Third-Quarter Earnings Miss Amid High AI Capital Expenditures
Amazon (AMZN) shares fell nearly 7% in premarket trading after reporting third-quarter earnings of $1.89 per share and revenue of $201.94 billion, both of which missed analyst consensus estimates. The company's massive capital expenditure, totaling $75.9 billion this quarter, contributed to a trailing 12-month free cash flow outflow of $42.4 billion as the firm aggressively invests in artificial intelligence infrastructure and its Amazon Bedrock service. Despite the immediate market reaction, Wall Street analysts remain largely bullish on the stock's long-term prospects. Major institutions including Morgan Stanley, Goldman Sachs, and Deutsche Bank maintain positive ratings, citing strong AWS growth acceleration and a significant backlog of enterprise contracts. Analysts suggest that while current spending is intensive, it positions Amazon to capture significant upside in the evolving AI market through 2027 and beyond.
Topics: AI capital expenditure analyst ratings AWS revenue earnings miss stock price movement
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