Amazon (AMZN) stock rose 3.49% to $265.21 during Friday’s trading session as strong buying pushed shares above $260 and toward $267.50 resistance. The move placed the stock near $265, while $262.50 and $260 remained key support levels for the day. Meanwhile, Amazon’s expanding AI spending coincides with faster AWS growth and rising revenue from its AI and chip businesses.

Amazon.com, Inc., AMZN

Amazon Expands AI Infrastructure Spending

Amazon spent $131 billion on capital expenditures in 2025, compared with $83 billion in 2024. The company initially projected about $200 billion in 2026 capital spending, but later raised that figure to nearly $220 billion. Consequently, the company could spend as much as $628 billion through 2028 as it expands computing capacity and related infrastructure. The scale places Amazon within a broader hyperscaler spending wave, as Microsoft, Alphabet, and Meta have also raised capital spending plans to build out AI data centers.

The higher spending has reduced Amazon’s free cash flow despite strong operating cash generation. Amazon generated $161.4 billion in operating cash flow during the 12 months ended June 30, while free cash flow fell to negative $7.6 billion. However, the spending supports data centers, chips, networking equipment, and other infrastructure needed for cloud and AI services.

Amazon has also linked much of its 2026 AWS capital spending to customer commitments. Therefore, the company expects much of that capacity to generate revenue during 2027 and 2028. This approach connects the infrastructure buildout with existing demand for cloud computing and AI capacity.

AWS Revenue Accelerates With AI Demand

AWS revenue increased 37% year over year to $42.2 billion in the second quarter. The increase marked AWS’s fastest growth rate in 18 quarters, while AWS operating income reached $16.6 billion from $10.2 billion. Amazon said its AI and chips businesses each exceeded a $25 billion annual revenue run rate. AWS remains the largest cloud infrastructure provider by revenue, ahead of Microsoft Azure and Google Cloud, and its growth rate is widely tracked as a measure of enterprise demand for AI computing. The chip business includes Amazon’s custom Trainium accelerators, which the company positions as an alternative to Nvidia GPUs for training and running AI models.

The AWS results show stronger demand alongside Amazon’s higher infrastructure spending. Moreover, the cloud unit continues to provide a major source of operating income as Amazon expands its AI capabilities. The company’s infrastructure investments therefore support services that already generate substantial sales and operating earnings.

Amazon’s retail business also uses AI to influence product discovery and shopping activity. In an online retail survey, 57% of Alexa AI users reported purchasing a product they previously did not know about. Consequently, Amazon’s AI tools can affect product discovery while the company expands its broader AI infrastructure.

The latest figures connect Amazon’s stock performance with stronger cloud growth and expanding AI-related operations. However, negative free cash flow remains a direct result of the company’s heavy capital spending. The gap between spending now and the customer-committed revenue expected in 2027 and 2028 frames the central open question for the buildout: how long free cash flow stays negative as the program continues. Amazon’s $265.21 share price reflects a strong move above $260, while $267.50 remains the nearest stated resistance level.