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Amazon Earnings: AI Spending on Edge
5 Feb
Summary
- Amazon faces scrutiny over AI spending ahead of Q4 earnings.
- The company announced 16,000 job cuts and store closures recently.
- Amazon's AWS segment revenue is projected to increase by 21%.
Amazon is preparing to announce its fourth-quarter financial results, as the company navigates concerns surrounding its substantial investments in artificial intelligence. This report comes after Meta and Microsoft revealed their earnings, with differing market reactions despite both increasing their AI spending.
In recent weeks, Amazon has also initiated a strategy of workforce reduction, cutting 16,000 jobs as part of an effort to streamline its organizational structure. Additionally, the company is closing some Amazon Fresh and Amazon Go locations, with plans to convert some of these spaces to Whole Foods stores.
Financially, Amazon is anticipated to report earnings per share of $1.96 on revenue of $211.5 billion. The crucial AWS segment is expected to reach $34.9 billion in revenue, marking a 21% year-over-year increase. Capital expenditures are also a key focus, with projections indicating continued investment to meet AI demand.
