The article notes Amazon overtook Walmart as America's largest company by revenue in this year's Fortune 500, and that almost 80% of its revenue comes from e-commerce, while most of its $2.7 trillion market cap is tied to AWS and AI expectations. In the latest quarter, North America e-commerce revenue rose 6% to $112.8 billion and its operating income rose 82% to $8.7 billion, above AWS operating income growth of 56% to $17.8 billion. The author argues that AI-related hurdles are mounting, including local blocks on data centers, negative cash flow at the megatechs, and a price war in AI products. The article says Amazon's large balance-sheet exposure and cloud/AI revenue carry significant risk.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
Amazone-commercecloud computingdata centers
Open a keyword to see other news on the same topic.
Related tickers and likely impact
AMZN
• NeutralAmazon
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Consumer Discretionary |
| Industry | Broadline Retail |
| Market cap | $2.6T |
| Close on 11/03/2026 | 250.74 |
| Change that session | +2.08% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- Top E-Commerce Stock Pick from BMO Capital Markets
BMO Capital Markets named Amazon (AMZN) its top pick in the e-commerce sector, reiterating its Outperform rating and raising its price target to $390 from $380. Third-quarter 2026 net sales met expectations and operating income beat estimates by 7%, with AWS revenue rising 39% year-over-year to $46 billion, its fastest growth in 19 quarters. Advertising growth slowed to 12% excluding foreign exchange, missing consensus by 6 percentage points due to a Prime Day calendar shift, while Online Stores rose 2%. Management projected AWS growth above 40% in 2027 and 2028, and total 2026 capital expenditures are expected to be around $220 billion. BMO raised its 2026/2027 net sales estimates to $831 billion/$974 billion and its 2027/2028 capex estimates to $320 billion/$335 billion.
- Amazon and Alphabet Are Each Spending At Least $200 Billion on Data Centers This Year. Here's Which Stock Outperforms Through 2028.
Alphabet plans to spend about $200 billion and Amazon about $220 billion on data center capex this year, with most of the computing power rented out through their cloud platforms. Google Cloud's backlog reached $514 billion in Q2 on $24.8 billion of revenue, while AWS had a $496 billion backlog and $42.2 billion of revenue. Google Cloud grew 82% and AWS 37%, but AWS's 39% operating margin far exceeds Amazon's 14% companywide margin, and AWS generated about 60% of Amazon's operating profit in Q2. CEO Andy Jassy said Amazon lacks enough computing capacity to meet 2026 demand, with 2028 demand already emerging. The author concludes that Amazon will outperform Alphabet through 2028 because AWS has a bigger influence on Amazon's bottom line.
- Amazon.com (AMZN) Cancels $427 Million Loudoun County Data Center Project
Amazon.com has dropped plans for a US$427 million data center complex in Loudoun County after sustained local opposition. According to local officials, part of the cancelled budget will go to new community investment initiatives in Northern Virginia. The article also cites Anthropic's report that cloud capacity for AI workloads is being rationed across large providers, including Amazon Web Services, because of supply constraints. Amazon's security teams are responding to the global PHP2Shell vulnerability, which targets PHP-based web servers and large-scale hosting environments. The article notes that Amazon continues heavy investment elsewhere, including a €16b program in Germany and work on small modular reactors.
- Not Microsoft. Not Alphabet. Here's the Cloud Giant I'm Most Bullish About.
The article argues Amazon (AMZN) is better positioned than Microsoft or Alphabet because Amazon Web Services has a bigger influence on its overall results. AWS, the world’s largest cloud service with about a 28% market share, grew revenue 37% year over year in the second quarter, up from 28% in the first quarter. Its operating income rose 64% with a 39% operating margin, compared with a 36% operating margin for Google Cloud, and AWS accounted for 60% of Amazon’s total operating income. Amazon is on course for around $220 billion in data center capital expenditures this year, and the article contends that AWS’s growth could lift Amazon’s overall profits faster.
- Nexxus Capital Strengthens Market Position with Latest E-Commerce Acquisition
Nexxus Capital, LLC announced the completion of a multi-stage transaction first completed in April 2026, through which it acquired and integrated two brand assets from a major Amazon aggregator. The two acquired brands generated $14.4 million in revenue in the 12 months before the acquisition, while maintaining strong gross margins. The company says this is its latest acquisition in recent months and that it specializes in operating brands on Amazon and other online marketplaces.
- Cosmos Health's Amazon UK Business Surpasses $2 Million in TTM Sales, Up 90%, with a 23% Net Profit Margin; Expects Sales to Grow Approximately 72% to $3.9 Million Over the Next Twelve Months
Cosmos Health (NASDAQ: COSM) reports that its Amazon UK sales for the trailing twelve months to November 2, 2026 reached about $2.27 million, up 90% from roughly $1.19 million in the prior twelve months, with 116,978 units sold, or about 320 per day. Monthly sales exceeded $215,000 in each of July through October 2026, the strongest four months on the platform. After all direct channel costs, including Amazon fees, cost of goods, shipping, advertising and VAT, the channel generated $525,000 in net profit, a margin of about 23%. Advertising was 2.4% of sales and refunds were below 1%. The company expects Amazon UK sales to rise about 72% to roughly $3.9 million over the next twelve months, an average of about $325,000 per month.
Related markets
Latest news
- The midterm election results are redrawing the map for AI data centers
U.S. data-center spending won't fall much, but individual projects may face delays, relocations and higher costs.
- Arm Stock Has Crashed 37%. Is It a Better Buy Than Qualcomm?
Arm shares fell 36.84% over the past month to $194.22, while Qualcomm traded at $167.07 and pays a quarterly dividend. The article says Qualcomm is far cheaper, at about 32 times earnings and a 7.30% free cash flow yield, versus about 239 times and 0.45% for Arm. Qualcomm yields about 2.17%, while Arm pays no dividend. Arm's fiscal Q1 2027 revenue rose 22% to $1.29 billion, whereas Qualcomm's fiscal Q3 revenue fell 4.0% to $9.95 billion as handset revenue dropped 20%, though automotive grew 61%. The article concludes Qualcomm fits a retiree's profile better, while Arm suits investors decades from retirement who can tolerate large declines.
- As Vistra and other energy stocks slide, some analysts warn of an ‘excessive knee-jerk’ reaction
Energy stocks were already under pressure, and newly elected officials may not slow the data-center boom as much as feared.
- Top VC: The Best AI Models Take “80% Plus” of Spend. And Alphabet’s Gemini Just Ranked No. 1
Alphabet's Gemini 4 Carbon ranks first on Artificial Analysis's Intelligence Index with a score of 59, but Anthropic and OpenAI still hold 86% of enterprise LLM API spend, up from 67%, and few customers can use Carbon yet. a16z's Martin Casado argues the best frontier models capture over 80% of market spending weighted by dollars, though he puts a model's lifespan at three to six months. Alphabet still earns from the labs that win through Google Cloud, whose revenue grew 103% last quarter from selling computing and TPUs to customers including Anthropic and, reportedly, Meta. Free cash flow is expected to be negative $18.0 billion this year as capital spending rises. Fourth-quarter results, due in early February, will be the first to cover a full quarter of Gemini 4.
- Musk Says Data Centers in Space “Looking Pretty Appealing Right Now” as SpaceX Sinks on Blue Wave
SpaceX (SPCX) shares fell 2% and Tesla (TSLA) dropped 3% after Democrats swept the midterms, including in Texas, where the newly elected governor campaigned on halting new data center construction. Dan Ives of Yorkville warned the blue wave could slow AI data center build-outs, while Elon Musk replied that data centers in space were “looking pretty appealing right now.” The article says Shaun Maguire’s bullish Sequoia model draws most of its 2028 revenue from ground-based data centers and assumes only a 20% political slowdown, an assumption now under pressure. Wall Street consensus for 2028 revenue is $336 billion, and the author argues orbital compute won’t fill the gap by 2028, making the 2028 estimates the ones to watch. SpaceX spent $19.6 billion on capex in the third quarter, with most of this year’s spending going to its data center segment.
- Bill Ackman: Netflix “an Incredibly Cheap Stock” After a 55% Drop. But Is He Right?
Netflix (NFLX) stock is down about 55% from its June 2025 high. Bill Ackman called Netflix “an incredibly cheap stock,” arguing the market is focused on engagement, as viewing hours fall because the content mix is changing. Average viewing time per member fell 26% over three years, much of it going to YouTube, but Netflix said churn improved year over year in the third quarter, both globally and in the U.S. The stock trades at 17x forward earnings, a little over half its five-year average of 32x, while analysts expect EPS to rise to $4.51 in 2028 from $2.53 in 2025. The main risk is that less viewing turns into cancellations, and Netflix’s 2027 guidance in January is the next test.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.