Amazon sales surged 14% during the fourth quarter, helped by strong holiday spending and better-than-expected growth in its cloud computing unit.
FILE - The Amazon logo is displayed at a news conference in New York on Sept. 28, 2011. FILE - People walk out of an Amazon Go store in Seattle, March 4, 2020. – Amazon sales surged 14% during the fourth quarter, helped by strong holiday spending and a better-than-expected growth in its prominent cloud computing unit.
But the Seattle-based online behemoth's shares fell nearly 10% in after-hours trading as its profits came in slightly below analysts' expectations. Investors also didn't seem to like Amazon's announcement Thursday that it was stepping up its capital expenditure to $200 billion this year, up from $125 billion last year as it sees opportunities in artificial intelligence, robots, semiconductors and satellites.Wall Street analysts were expecting spending to rise to around $147 billion this year, according to FactSet.n the second round of mass layoffs for the e-commerce company in three months. It has said that most of these cuts are part of an effort to reduce the workforce that swelled during the pandemic, not because of artificial intelligence. Separately Amazon said it would cut about 5,000 retail workers, according to notices it sent to state workforce agencies in California, Maryland and Washington, resulting from its decision toof 14,000 job cuts in October, bringing the total to well over 30,000 since Amazon's CEO Andy Jassy first signaled a push for AI-driven organizational changes. Analysts are analyzing retailers’ performances for insight into how shoppers spent during the holidays and what’s in store for 2026. They also want to know how the online behemoth is managing cost increases given all the uncertainty around President Donald Trump’s tariffs. Amazon is also under pressure to shore up confidence that its computing arm Amazon Web Services is just as powerful as Microsoft’s Azure and Google’s Google Cloud platform. Amazon delivered 24% growth for AWS in the fourth quarter, the fastest in 13 quarters, the company said. That followed 20% growth in the third quarter and a 17.5% increase in the second. Meta, Apple and other Big Tech firms are expected to ramp up their spending on artificial intelligence this year. After pouring $91 billion into capital expenditures devoted mostly to AI, Alphabet, the parent company of Google, disclosed Wednesday thatAmazon also continues to invest in its speedy fulfillment network, through a combination of robotics, AI technology and more efficient warehousing. The online retailer said it now delivers groceries in 5,000 U.S. cities and towns. In many of them, customers can get same-day delivery of fresh produce and other perishables. Based on strong customer feedback, it said it plans to expand its same-day delivery to more places this year.Last week, it said that it was closing almostwithin days as it narrows its focus on food delivery and its grocery chain, Whole Foods Market. Some of the shuttered stores will be converted into Whole Foods locations, the company said in a blog post last week. Amazon reported net income of $21.2 billion, or $1.95 per share, for the three-month period ended Dec. 31. That compares with $20 billion, or $1.86 per share, in the year-ago quarter. Revenue rose to $213.4 billion in the fourth quarter, compared with $187.8 billion in the year-ago period. Analysts were expecting $1.97 per share on sales of $211.4 billion, according to analysts polled by FactSet.The company said that it expects sales to be between $173.5 billion and $178.5 billion for the first quarter.Copyright 2026 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.Heard about the Arctic blast? 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