Amazon Reports Strong Revenue but Faces Investor Concerns
Amazon (NASDAQ: AMZN) announced a revenue increase to over $213 billion for the recent quarter, surpassing analysts’ expectations of $211 billion. Its cloud computing division, Amazon Web Services (AWS), achieved a revenue of over $35 billion, exceeding estimates of $34 billion, driven by strong demand for AI services and a 24% revenue gain—its highest growth rate in 13 quarters.
Despite these positive developments, Amazon’s plan to allocate $200 billion towards capital expenditures, primarily focused on AWS, raised concerns among investors, leading to a 10% decline in stock value during pre-market trading. Analysts noted the existing risk of overbuilding in the cloud sector amid growing AI infrastructure needs.
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