Core Insights - Amazon's fourth-quarter earnings revealed two contrasting aspects: a profitable, streamlined operation and a company aggressively investing in future technologies [1][2] - CEO Andy Jassy announced a significant capital expenditure plan of approximately $200 billion by 2026, focusing on AI, chips, robotics, and low earth orbit satellites, which raised concerns among investors [2] - Despite strong quarterly performance, including revenue exceeding $211.4 billion and AWS achieving its fastest growth in 13 quarters, the market reacted negatively to the high spending plans [3][5] Financial Performance - Amazon's revenue for the quarter surpassed analyst expectations, while earnings per share were reported at $1.95, slightly below the anticipated $1.97 [3] - AWS showed robust growth, contributing to the overall positive financial results, with advertising revenue increasing by 23% and custom chips experiencing triple-digit growth [3] Market Sentiment - The current market environment is focused on evaluating the justification for large capital expenditures rather than just the financial results themselves [4] - Investors are becoming increasingly cautious about Big Tech's spending plans, particularly in AI infrastructure, with expectations of over $500 billion in spending by 2026 [4] - Amazon's guidance for future spending has led to skepticism, placing it in a less favorable category compared to peers who demonstrate a balance of spending and growth [5]

Core Insights - Amazon's sales increased by 14% in the fourth quarter, driven by strong holiday spending and growth in its cloud computing unit [1] - Despite the sales growth, Amazon's shares fell by 11% in after-hours trading due to plans to increase capital spending by nearly 60% to $200 billion from $128 billion last year [2] - Amazon's CEO Andy Jassy expressed confidence in long-term returns on invested capital, highlighting the company's focus on artificial intelligence and other technologies [3] Financial Performance - Amazon's fourth-quarter profits were slightly below analysts' expectations, contributing to the decline in share price [2] - Amazon Web Services (AWS) experienced a 24% growth in the fourth quarter, marking the fastest growth in 13 quarters, following 20% growth in the third quarter and 17.5% in the second quarter [7] Workforce Changes - Amazon is undergoing significant layoffs, cutting about 16,000 corporate jobs, with an additional 5,000 retail workers due to the closure of Amazon Go and Amazon Fresh stores, totaling over 30,000 job cuts since the push for AI-driven changes began [4][5] Competitive Landscape - Amazon faces pressure to demonstrate that AWS is competitive with Microsoft Azure and Google Cloud, as these companies also ramp up their investments in artificial intelligence [6]

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company operates with a team of experienced and qualified news journalists across key finance and investing hubs including London, New York, Toronto, Vancouver, Sydney, and Perth [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The content delivered by the team includes insights across various sectors such as biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Utilization - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company employs automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans to maintain best practices in content production and search engine optimization [5]

Core Viewpoint - Amazon's shares experienced a significant decline following the release of mixed fourth-quarter earnings and an aggressive forecast for AI spending in 2026, which exceeded analyst expectations by a substantial margin [1][2]. Financial Performance - Revenue for the fourth quarter rose 14% year-over-year to $213.4 billion, slightly surpassing Wall Street analysts' consensus estimates [1]. - Earnings per share for the quarter were reported at $1.95 on a diluted basis, missing expectations by one cent [1]. Stock Market Reaction - Amazon's stock fell 4% during regular trading and an additional 7% in after-hours trading after the earnings report was released [2]. AI Investment Strategy - The company announced plans to invest $200 billion in AI by 2026, which is over $55 billion more than what analysts had anticipated [2]. - CEO Andy Jassy emphasized that the substantial capital expenditure is justified by strong demand for existing offerings and significant opportunities in AI, chips, robotics, and low earth orbit satellites [4]. Advertising and Viewership Growth - The holiday quarter saw Prime Video achieve record viewership for Thursday Night Football, averaging 15.33 million viewers per game across 15 regular-season games [5]. - Prime Video also began streaming NBA games as part of an 11-year deal initiated last October [5]. - Advertising revenue for Prime increased by 22% year-over-year, reaching $21.3 billion, marking the latest in a series of quarterly increases exceeding 20% [6].

Group 1: Middle East Negotiations - Multiple Middle Eastern countries urgently lobbied the Trump administration to resume the US-Iran nuclear talks originally scheduled for February 6, which will now take place in Oman [4][20] - The deadlock raised concerns across the Middle East about potential military actions by Trump, prompting at least nine countries to contact the White House to advocate for the continuation of the meeting [6][20] - US officials indicated that the decision to hold the meeting was made to respect allies in the region and to continue seeking diplomatic avenues [6][20] Group 2: Bitcoin Market - Bitcoin experienced a significant drop, falling below $65,000, erasing all gains made since Trump's election, with a peak decline of 11% to $64,944, marking the lowest level since October 2024 [7][21][24] - This decline has resulted in nearly half of Bitcoin's value being wiped out since its record high four months ago, affecting other cryptocurrencies and related ETFs [7][24] Group 3: Amazon's Capital Expenditure - Amazon projected its capital expenditures for 2026 to reach $200 billion, significantly exceeding market expectations of $144.67 billion, indicating continued investment in artificial intelligence [9][26] - The company's forecast for first-quarter operating profit was between $16.5 billion and $21.5 billion, lower than the market's expectation of $22.04 billion, leading to a post-market stock decline of over 11% [10][26] Group 4: Rio Tinto and Glencore Merger - Rio Tinto announced its withdrawal from negotiations to acquire Glencore due to disagreements over valuation, resulting in the collapse of a potential merger that could have created the world's largest mining company [12][28] - Following the announcement of the failed merger talks, Glencore's stock price dropped by 11% [29] Group 5: Federal Reserve Rate Expectations - Traders have adjusted their expectations for the Federal Reserve's next interest rate cut to June, earlier than previously anticipated in July, with a second cut expected before October [16][33] - This shift in expectations was influenced by weak labor market data, leading to a decline in the secured overnight financing rate (SOFR) futures yield by approximately 9 basis points [33]

Group 1 - The fourth quarter earnings season is ongoing, with significant results from major companies like Alphabet, Amazon, AMD, Qualcomm, and Palantir [1] - As of January 30, 33% of S&P 500 companies have reported their fourth quarter results, with analysts estimating an 11.9% increase in earnings per share, marking the 10th consecutive quarter of annual earnings growth for the index [2] - Analysts initially expected an 8.3% increase in earnings per share heading into the reporting period, which was revised from a previous growth rate of 13.6% in the third quarter [4] Group 2 - The capital expenditures of major tech companies are influencing the AI trade, with ongoing themes from 2025 such as artificial intelligence and economic policies continuing to impact investor sentiment [5] - Updates from various companies including Disney, Chipotle, PepsiCo, Uber, and Snap were also highlighted during this earnings season [5]

Core Insights - Amazon reported record quarterly revenue and strong growth in its cloud segment for Q4, indicating robust performance in its core business areas [1] - Despite the positive financial results, Amazon's stock experienced a decline following the announcement of its capital expenditure plans for 2026, which raised concerns among investors [1] Financial Performance - The company achieved record quarterly revenue, showcasing its ability to generate significant sales [1] - Strong growth in the cloud segment highlights the increasing demand for cloud services, which is a critical area for Amazon's future growth [1] Capital Expenditure Plans - Amazon's capital expenditure plans for 2026 were a focal point of investor concern, leading to a drop in stock price despite the strong quarterly results [1]

Exhibit 99.1 AMAZON.COM ANNOUNCES FOURTH QUARTER RESULTS SEATTLE—(BUSINESS WIRE) February 5, 2026—Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its fourth quarter ended December 31, 2025. Fourth Quarter 2025 Full Year 2025 • Net sales increased 14% to $213.4 billion in the fourth quarter, compared with $187.8 billion in fourth quarter 2024. Excluding the $2.8 billion favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 12% ...

Core Insights - Amazon Web Services (AWS) revenue increased by nearly 24% in Q4, reaching $35.58 billion, surpassing analysts' expectations of $34.93 billion, and accounted for approximately 17% of Amazon's total revenue for the quarter [1][2] Group 1: Financial Performance - AWS operating income was $12.47 billion, exceeding the consensus estimate of $11.91 billion, and represented a significant portion of Amazon's overall profits [2] - The operating margin for AWS slightly widened to 35% from 34.6% in the previous quarter [2] Group 2: Competitive Landscape - Amazon continues to lead the cloud infrastructure market, which it pioneered nearly 20 years ago, but faces increasing competition from Google and Microsoft, both of which are experiencing rapid growth in their cloud services, particularly in artificial intelligence [2][3] - Google Cloud revenue surged by about 48%, marking its fastest growth since 2021, while Microsoft reported a 39% increase in revenue from Azure and other cloud services [3] Group 3: Product Developments and Investments - In Q4, AWS launched Nova Forge, which allows access to Amazon's generative AI models for advanced customization during the training phase, and announced a $38 billion spending commitment from OpenAI [4] - AWS added nearly 4 gigawatts of computing capacity in 2025, while Microsoft added almost 1 gigawatt during the same period [5] - Amazon anticipates $200 billion in capital expenditures for 2026, significantly higher than the consensus estimate of $148.86 billion [5]

Core Viewpoint - Amazon is set to make significant capital expenditures of approximately $200 billion by 2026, indicating that major U.S. tech companies will continue their substantial investments in artificial intelligence in the short term [2][6] Group 1: Capital Expenditure and Market Expectations - Amazon's projected capital expenditure for 2026 is significantly higher than the previous market expectation of $144.67 billion [2][6] - The company's forecast for Q1 operating profit is between $16.5 billion and $21.5 billion, which is below the market expectation of $22.04 billion, leading to a drop in stock price by over 11% in after-hours trading [2][6] Group 2: Industry Trends and AI Investment - Major tech companies are investing heavily in processors, data centers, and networking equipment to accelerate AI infrastructure development, with total capital expenditures for the four largest cloud service providers expected to exceed $500 billion this year [2][6] - Recent earnings reports have conveyed a clear message from Wall Street: rapid growth in AI spending will only be tolerated if it leads to corresponding operational or financial returns [2][6] Group 3: Amazon's Cloud and Retail Strategies - Amazon continues to see strong demand for AI infrastructure and core digital migration workloads, although industry-wide capacity constraints limit its ability to fully meet this demand [3][7] - The company is increasing investments in the fourth quarter to alleviate these capacity bottlenecks and has launched the "Rainier" AI infrastructure project, deploying nearly 500,000 self-developed Trainium2 chips primarily for the Claude chatbot developer, Anthropic [3][7] - AWS, while accounting for only about 15% to 20% of Amazon's total sales, contributes over 60% of the company's operating profit [3][7] - Amazon is also expanding its e-commerce business by enhancing same-day and next-day delivery capabilities and increasing its fresh food offerings to attract more customers [3][7] - Recent retail initiatives include expanding the Whole Foods store footprint and constructing a large 225,000 square foot store to compete with Walmart and Costco [3][7]