Street View: Amazon's capex boost in line with demand, analysts say

Amazon AMZN.O on Thursday projected a surge of more than 50% in capital expenditures this year, joining its peers in a spending spree to build out artificial-intelligence infrastructure

Shares down 7.4% at $206.18 premarket

MARGIN OF ERROR SHRINKING

Morgan Stanley ("overweight," PT: $300) says Amazon's strength in AWS growth justifies the spend

Citigroup ("buy," PT: $265) says "given the demand trends and potential future opportunity of AI, we believe this investment is the right thing to longer-term"

RBC Capital Markets ("outperform," PT: $300) says "AMZN is clearly testing investors' patience - and there's no fighting $200B"

MoffettNathanson ("buy," PT: $283) says AMZN wouldn't be spending $200 billion in FY26 if they didn't have the appropriate demand signals, however they flag "the margin of error is shrinking"

Pivotal Research ("buy," PT: $300) says they're confident that Amazon's capex spending is directly linked to strength in demand, which will translate into strong financial returns going forward