Amazon’s AI Spending Plans Keep Stock From Joining Tech Rebound
- Amazon is switching to spending after years of cost cutting
- Shares have trailed other megacap tech stocks this month
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More than any of the megacap technology stocks, Amazon.com Inc.’s big spending ways are coming at the expense of profits, and its shares are being punished as a result.
Amazon’s stock performance has lagged its megacap peers since its earnings report at the beginning of August, when the e-commerce giant signaled to investors that it would be prioritizing spending on artificial intelligence computing. The move is a shift back into investment mode after a period of cost cutting that led to a surge in profits and helped fuel a rally that’s seen the shares more than double from a late 2022 low.