Amazon has not repurchased shares for four years, prioritizing investments in AI infrastructure and custom chips over capital returns.
Amazon has not executed any stock buybacks since Q2 2022, opting instead to allocate capital toward AWS expansion, AI data centers, and custom chips like Trainium and Inferentia. The company trades at a near-decade-low valuation of approximately 29x earnings, despite analysts projecting 22% annual earnings growth over the next five years.
Wall Street’s focus has shifted from buybacks to AI infrastructure, with tech giants redirecting billions into long-term growth. Amazon’s decision reflects a belief that AI investments yield higher returns than share repurchases, even as free cash flow faces pressure from rising capital expenditures.
While semiconductor firms benefit from surging AI chip demand, hyperscalers like Amazon are prioritizing future capacity over immediate shareholder returns.