Amazon (AMZN) stock is now down over 8% on Friday and over 14% in the past week, following key updates in its Q4 earnings report. While the e-commerce giant’s earnings fell in line with Wall Street expectations, it was its capital expenditure preview for 2026 that scared investors. Indeed, Amazon plans to invest $200 billion in AI and other technologies in 2026, leading to a drop in its stock after mixed earnings results. The company’s capital expenditure forecast has raised concerns among investors, reflecting broader trends in the tech sector.
Amazon (AMZN) stock is currently experiencing a bearish outlook, as the company’s fourth-quarter earnings report projected a staggering $200B AI spending segment. The firm shared how it expects its capital expenditures to continue surging as it heavily pivots towards data centers and infrastructure to cater to its rising AI demand.
“With such strong demand for our existing offerings and seminal opportunities like AI, chips, robotics, and low-earth orbit satellites, we expect to invest about $200 billion in capital expenditures across Amazon in 2026 and anticipate strong long-term return on invested capital,” CEO Andy Jassy said in a statement. The announcement was met with a mix of strikingly bearish reviews, with investors skeptical about the firm’s plan to spend $200B to embrace AI.
Investor sentiment is cautious, as Amazon’s (AMZN) stock decline reflects worries over its capital expenditure plans and competitive positioning in the AI sector. Current analyst price targets range from $244 to $340, suggesting potential upside from the current market price of $246.29. Cantor Fitzgerald recently reiterated an Overweight rating with a price target of $260. Other analysts, including Wedbush and B of A Securities, maintain a Buy or equivalent rating.