- Amazon shares fell 13% into a correction amid concerns over $200 billion in capital spending, but Q1 2026 revenue of $181.5 billion beat estimates and operating margins hit a record 13.1%.
- AWS growth accelerated to 28% year-over-year, the fastest rate in 15 quarters, while the company’s Q1 backlog reached $364 billion, excluding a $100 billion+ deal with Anthropic.
- Wall Street price targets average around $285, with Q2 guidance pointing to $194 billion to $199 billion in sales, suggesting the sell-off may be overdone.
The question dominating trading forums this week is whether to sell Amazon stock after shares dropped 13% and slid into a correction, but a closer look at the numbers tells a different story. Amazon is pouring nearly $200 billion into capital spending this year, mostly for AWS data centers and AI chips, and that figure has spooked traders worried about cash flow and a weaker consumer.
However, revenue for the first quarter of 2026 came in at $181.5 billion, up 17% from a year earlier and ahead of analyst expectations. Operating margin hit a record 13.1%, and CEO Andy Jassy noted that “AWS growth continued to accelerate, up 28% year-over-year, the fastest growth rate in 15 quarters.” He also revealed that “the backlog for Q1 is $364 billion,” a figure that does not include the recent $100 billion deal with Anthropic.
Consequently, Jassy added that “we have never seen a technology grow as rapidly as AI,” underscoring the demand driving those massive capital investments. Wall Street’s Amazon stock forecast remains bullish, with price targets averaging around $285 and Q2 guidance already pointing to $194 billion to $199 billion in sales.
Meanwhile, any sell-or-hold decision still depends on individual portfolio circumstances, but the data leans toward holding. Amazon stock analysis built on accelerating AWS growth, record margins, and a backlog north of $364 billion does not support selling outright.
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