Amazon Earnings Set Against $650B AI Capex Push After 25% Surge
Amazon shares rose over 25% in the past month after closing an AWS Graviton5 chip deal with Meta and securing a $100 billion Anthropic commitment boosting AWS custom chip revenue to a $20 billion run rate. The company reports April 29 earnings while joining a $650 billion AI capex push that strains its 37x P/E.
1. Major AI Infrastructure Contracts
Amazon secured an AWS Graviton5 chip deal with Meta and locked in a $100 billion, 10-year commitment from Anthropic, strengthening its position in cloud AI services.
2. Custom Chip Revenue Growth
AWS custom chip business achieved triple-digit growth, driving revenue to a $20 billion annual run rate and underpinning Amazon’s strategy to develop proprietary hardware.
3. Upcoming Earnings and Heavy Capex
Amazon will report first-quarter results on April 29 alongside Alphabet, Meta and Microsoft as part of a collective $650 billion spending plan on AI infrastructure this year.
4. Valuation and Spending Outlook
Despite robust AI-driven fundamentals, Amazon’s 37x P/E ratio and forecasted $200 billion capital expenditures for 2026 present valuation and cash flow challenges.