Amazon Stock Slides Friday Amid Concerns About AI Spending, Soft Forecast | Global News Avenue

Amazon (Amzn) Stocks fell on Friday, with some analysts lowering their price targets, concerns over the tech giant’s plans to increase AI spending and plans More than expected sales forecasts.

CEO Andy Jassy Spend more than $100 billion Most of this year’s capital expenditure will be used to build AI infrastructure to increase production capacity.

Analysts are largely optimistic about the stock’s upward trajectory, but some lowered their price targets after Thursday’s earnings call.

Citi analysts who maintain the stock’s “buy” rating said the expansion of Amazon’s AI infrastructure could help “relieve capacity constraints” and make AWS faster. Still, analysts lowered their stock target from $275 to $275, pointing out that Amazon’s sales forecasts and its spending plans are weak.

JPMorgan analysts said that given the very clear path to monetizing AI through AWS, they are more “comfortable” with Amazon’s spending. However, JPMorgan also lowered its target target from $280 to $270, reducing its 2025 and 2026 net sales estimates.

Amazon’s plan to increase spending on AI follows similar moves from several of its large technology peers. Google Parents Letters (GOOGL) Earlier this week Say it will cost $75 billion exist Capital Expenditure Supports expansion of its AI capabilities this year. Last week, meta(Yuan) Indicates that it plans to invest $60 billion to $65 billion This year and Microsoft (MSFT) Say it plans to spend $80 billion On infrastructure for fiscal year 2025.

Morgan Stanley analysts said that Big Tech heavyweights spent hundreds of billions of dollars on AI this year, “it is more important to each platform’s ability to demonstrate incremental participation in matters.” They maintain Amazon stock price targets at $280 and a “overweight” rating.

Amazon’s shares fell about 4% on Friday to close at $229.15, although even with Friday’s losses, they’ve been worth nearly a third of their value over the past 12 months.