Amazon shares plunged after the tech giant reported mixed fourth-quarter earnings and issued an aggressive forecast for 2026 spending on AI.<\/p>\n
Revenue for the October-to-December period edged Wall Street analysts\u2019 consensus estimates, rising 14% from the year-ago quarter to $213.4. Earnings per share missed the mark by a penny, coming in at $1.95 on a diluted basis.<\/p>\n
Amazon shares tumbled 4% in Thursday\u2019s regular session and another 7% in after-hours trading as the earnings and other data points reached the marketplace. The company said it will spend $200 billion on AI in 2026, which is more than $55 billion more than analysts had been expecting.<\/p>\n
The stocks of Amazon and many other large tech companies have come under pressure in recent days in the latest investor rethink of AI. With hundreds of billions of dollars a year collectively going toward data centers and other resources, some see a bubble set to burst.<\/p>\n
Watch on Deadline<\/p>\n
In the company\u2019s quarterly letter to shareholders, CEO Andy Jassy assured them that the long-term return on the immense capital outlay will be \u201cstrong.\u201d The level of spending was set in light of \u201cstrong demand for our existing offerings and seminal opportunities like AI, chips, robotics, and low earth orbit satellites,\u201d he said.<\/p>\n
During a conference call with analysts, Jassy expanded on that idea, arguing that the AI \u201cmovement,\u201d as he called it, will be \u201cvery broad.\u201d It will involve not just a select few companies investing heavily, but \u201cthousands:\u201d of entrants.<\/p>\n
The holiday quarter included the most-viewed season to date of Thursday Night Football on Prime Video, with 15.33 million average viewers for each of the regular season\u2019s 15 games. Prime Video also started streaming NBA games last October, kicking off an 11-year deal. Black Friday has also become a football window, enabling advertising both on Prime Video and across the company\u2019s home page and e-commerce operation as holiday shopping begins.<\/p>\n
Jassy during the call pointed to Thursday Night Football as an important seedbed of AI innovation.<\/p>\n
Prime\u2019s strides during the quarter included another jump in ad revenue, which climbed 23% from a year ago to $21.3 billion, the latest 20%-plus quarterly increase in the category.<\/p>\n
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