Amazon’s stock has just endured nine consecutive down days — the longest slump since 2006 — wiping out over $460 billion in market value as investors fret over massive AI-related spending. With plans to invest roughly $200 billion in capital expenditures in 2026, questions around cash flow, margins and timing of returns are at the forefront. Is this correction simply a market overreaction, or could today’s weakness set the stage for a stronger comeback?

Amazon is no longer just an e-tailer today. It's a combination of three big businesses with different economics and cyclicality. It is retail, an advertising platform tied to customer shopping behavior, and cloud infrastructure (AWS). This diversification is why Amazon often behaves differently in the stock market than pure retail or pure technology companies. Its results and valuations are a mix of logistics, software margins and capital intensity.

In 2025, Amazon reported revenues of $716.9 billion (+12% y/y) and operating profit of $77…