Amazon Shares Surge as CEO Outlines $200 Billion AI Infrastructure Strategy

Amazon (AMZN) saw a significant rally on Thursday, with shares closing at $233.65, a 5.60% increase. The surge followed the release of CEO Andy Jassy's annual shareholder letter, which provided clarity on the company's strategic pivot toward artificial intelligence and custom chip development. The market has been cautious regarding the massive capital expenditures required for AI infrastructure. Jassy addressed these concerns directly, framing the spending not as a speculative bet but as a response to existing customer demand. Jassy disclosed that AI services within Amazon Web Services (AWS) have already achieved a revenue run rate of $15 billion. Furthermore, he noted that a substantial portion of the approximately $200 billion in expected 2026 capital expenditures is already backed by customer commitments, with monetization expected to peak in 2027 and 2028. Trading volume for the e-commerce giant reached 64.9 million shares, roughly 30% above its three-month average of 50.1 million. The rally contributed to broader gains in the tech sector, with the Nasdaq Composite closing at 22,822 (+0.83%) and the S&P 500 ending at 6,824 (+0.61%). While other internet retail players like Alibaba Group (BABA) and MercadoLibre (MELI) also posted gains, their movements were modest compared to Amazon's AI-driven spike, highlighting investor confidence in Amazon's specific cloud growth trajectory.