Markets Recover Friday While Amazon Slides on $200 Billion AI Spending Forecast
New York, Friday, 6 February 2026.
Wall Street stabilized Friday, yet Amazon shares tumbled after announcing a $200 billion AI investment plan for 2026, surpassing analyst expectations by $50 billion.
Market Resilience Amidst Tech Volatility
Major U.S. equity markets managed to find their footing on Friday, February 6, marking a stabilization effort after a tumultuous week for the technology sector. The Dow Jones Industrial Average rose 1.1%, while the S&P 500 and the Nasdaq Composite advanced 0.9% and 0.8%, respectively [1]. This recovery comes despite significant headwinds generated by Amazon (AMZN), which saw its shares slide 9% on February 5 [1]. The divergence between the broader market’s recovery and Amazon’s decline highlights a critical friction point in the current economic landscape: the astronomical cost of building artificial intelligence infrastructure versus the market’s appetite for immediate returns.
The Price of Intelligence
The catalyst for Amazon’s stock pressure was the company’s revelation on Thursday regarding its spending plans for the coming year. Amazon projected a capital expenditure (capex) surge to $200 billion in 2026, a figure that exceeded Wall Street’s expectations by more than $50 billion [2][3]. To put this financial commitment into perspective, Amazon spent approximately $131 billion on property and equipment in 2025 [4]. This represents a projected year-over-year increase of 52.672%. This aggressive scaling is part of a broader trend among industry leaders; the top four hyperscalers—Amazon, Microsoft, Google, and Meta—are collectively expected to spend over $630 billion in 2026 to support AI development [2].
Investor Skepticism vs. Executive Confidence
The sheer magnitude of this investment has sparked tangible anxiety among investors, who are increasingly scrutinizing the timeline for returns on such massive outlays. Following the announcement, Amazon shares fell more than 10% in after-hours trading on Thursday [3][5]. Dave Wagner, a portfolio manager at Aptus Capital Advisors, noted that the market currently “dislikes the substantial amount of money that keeps getting put into capex” for the projected growth rates [2]. However, Amazon CEO Andy Jassy remained steadfast during the earnings call, describing the AI landscape as an “extraordinarily unusual opportunity” [3]. Jassy argued that the company is confident these investments will yield strong returns on invested capital, dismissing the notion that the spending plan is a “quixotic top-line grab” [3][4].
Underlying Operational Strength
Beneath the concerns over capital expenditures, Amazon’s core business segments demonstrated robust performance in the fourth quarter. The company reported revenue of $211.4 billion, beating analyst expectations [6]. A significant driver of this growth was Amazon Web Services (AWS), which generated $35.6 billion in sales, marking a 24% increase [2][4]. Jassy highlighted that AWS delivered its fastest growth in 13 quarters, reinforcing the division’s critical role in Amazon’s profitability [4][6]. While the $200 billion spending roadmap has introduced short-term volatility, the company’s fundamental operational metrics suggest that demand for its cloud and advertising services remains resilient.