Core Viewpoint - The recent earnings report from Amazon has raised concerns among investors, particularly regarding the performance of its cloud service (AWS) and its significant investments in artificial intelligence (AI), leading to a sharp decline in its stock price [1][2]. Group 1: Amazon's Financial Performance - Amazon's stock price fell by over 9% during trading on August 1, closing down 8.27%, resulting in a market value loss of over $206.3 billion (approximately 1.474 trillion RMB) [2]. - AWS generated $30.8 billion in revenue for Q2, slightly exceeding expectations of $30.7 billion, with a year-on-year growth of 17%, maintaining the same growth rate as the previous quarter [2]. - The operating profit margin for AWS dropped from a record 39.5% in Q1 to 32.9% in Q2, indicating a decline in profitability [2]. - Amazon's overall Q2 earnings per share were $1.68, with total revenue of $167.7 billion, both surpassing market expectations [3]. Group 2: Competitive Landscape - Compared to competitors, Amazon's AWS growth is lagging behind Microsoft and Google, with Microsoft reporting a 34% year-on-year growth for its Azure services, which is significantly higher than AWS's performance [2][3]. - Analysts are increasingly suggesting that competitors are gaining an advantage over AWS, as evidenced by Microsoft's Azure revenue surpassing $75 billion for the fiscal year 2025 [3]. Group 3: Management Commentary - Amazon's CEO, Andy Jassy, acknowledged a supply bottleneck in AI capabilities, stating that the primary constraint is electricity, which has heightened investor concerns [1][4]. - Jassy attempted to reassure investors about AWS's competitive position, emphasizing its scale and differentiated advantages, including superior security and operational performance [6]. - He also highlighted the potential of AI-driven products like Alexa+, which is being positioned as a more advanced personal assistant, indicating a clear commercialization path through various channels [7].

Core Viewpoint - The article highlights the significant decline in Amazon's stock price following its latest earnings report, raising concerns about its cloud service growth and profitability compared to competitors like Microsoft and Google [2][3][4]. Group 1: Amazon's Earnings Report - Amazon's AWS business generated $30.8 billion in revenue for Q2, slightly exceeding expectations but showing a year-on-year growth of 17%, which is stagnant compared to the previous quarter [3]. - The operating profit margin for AWS dropped from a record 39.5% in Q1 to 32.9% in Q2, attributed to increased capital investments in AI-related infrastructure [3][4]. - Amazon's overall Q2 earnings per share were $1.68, with total revenue of $167.7 billion, both surpassing market expectations [4]. Group 2: Market Reaction and Competitor Comparison - Following the earnings report, Amazon's stock fell by 8.27%, resulting in a market value loss of over $206.3 billion (approximately 1474 billion RMB) [3]. - In contrast, Microsoft's Azure reported a significant revenue increase of 34% year-on-year, with expectations of surpassing $75 billion in fiscal 2025, highlighting a competitive edge over AWS [4]. - Analysts express concerns that competitors are gaining momentum at Amazon's expense, as evidenced by the market's negative reaction to Amazon's performance [4]. Group 3: CEO's Statements and Future Outlook - Amazon CEO Andy Jassy acknowledged supply constraints in AI capabilities, particularly in power supply, which has raised investor concerns [6][7]. - Jassy attempted to reassure investors about AWS's leadership position and its differentiated advantages, including proprietary AI chips that outperform competitors [8]. - He also expressed optimism about the future of AI in enhancing customer experiences and operational efficiency, despite uncertainties regarding tariffs and trade policies [9].