Amazon (AMZN) is set to report its second quarter earnings after the bell on Thursday, a week after Google parent Alphabet’s (GOOG, GOOGL) results fell flat on Wall Street.
During its earnings call, Alphabet said it will increase spending on its AI build-out, raising its anticipated capital expenditures to between $195 billion and $205 billion, up from its prior estimate of $180 billion to $190 billion
And while Alphabet’s overall earnings and revenue topped expectations, that spending number was enough to send investors for the exits. Shares fell more than 6% following the news. In February, Amazon said it planned to spend some $200 billion on capital expenditures in 2026.
If the company pushes that higher, investors could react as they did to Alphabet’s revised spending. Analysts are projecting capex of $48.7 billion for the period. But Amazon could keep Wall Street happy if it shows that those investments are paying off for its Amazon Web Services (AWS) segment. “We continue to view AWS growth as the key metric driving sentiment as investors wrestle with the returns on the massive infrastructure build out,” KeyBanc Capital Markets analyst Justin Patterson wrote in an investor note.