Amazon Powers Up Record Q4 Sales, Forecasts 50% Increase in Capex for 2026 to $200 Billion

Amazon‘s shopping cart spilled over in the fourth quarter of 2025: The ecommerce behemoth raked in a record $213.4 billion in revenue that beat Wall Street expectations. But the company’s shares fell in after-hours trading Thursday after Amazon said it expected to increase capital spending roughly 50% to $200 billion for 2026 as it races to compete in the AI space.

Overall net sales for the year-end 2025 holiday shopping quarter increased 14%. Net income was $21.2 billion (up 5.9%), translating to $1.95 per diluted share, which slightly missed forecasts.

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Meanwhile, Amazon continued to carve off a bigger chunk of the digital ad market. Q4 advertising revenue totaled $21.32 billion, up 23%, which slightly topped expectations. Amazon’s ad services includes Prime Video ads and other video advertising, display ads and sponsored ads sold to sellers, vendors, publishers, authors and others. (By default, Prime Video, included as perk for Prime members, includes ads unless you pay extra for a no-ads experience.)

Revenue from Amazon’s subscriptions services rose 14% to $13.12 billion in the quarter. That Includes annual and monthly fees associated with Amazon Prime memberships, as well as digital video, audiobook, digital music, e-book and other non-AWS subscription services.

Amazon president and CEO Andy Jassy, in announcing the earnings, also touted AWS revenue growth of 24% in the quarter, to $35.58 billion — its fastest growth in 13 quarters — alongside growth in advertising and its chips business.

“With such strong demand for our existing offerings and seminal opportunities like AI, chips, robotics, and low earth orbit satellites, we expect to invest about $200 billion in capital expenditures across Amazon in 2026, and anticipate strong long-term return on invested capital,” Jassy said. For full-year 2025, Amazon reported capex of $131.82 billion.

The 2026 capex will predominantly be invested in AWS, Jassy told analysts. “As fast are we are installing this AI capacity, it’s getting monetized,” he said.

The Q4 results come a week after Amazon announced that it was laying off 16,000 employees across its corporate departments, citing the need for “reducing layers, increasing ownership and removing bureaucracy.” That follows its pink-slipping 14,000 employees last October. All together, the 30,000 jobs represent almost 10% of the ecommerce giant’s previous corporate headcount.

For the quarter, Wall Street analysts on average expected revenue of $211.33 billion and earnings of $1.97 per share, per LSEG Data & Analytics. The ecommerce giant’s ad revenue was projected to be $21.16 billion, according to StreetAccount.

On the call, Jassy touted Amazon’s claim that Prime Video reaches more than 315 million monthly viewers worldwide, up from 200 million in mid-2024. Ads on Prime Video are now live in 16 countries.

Not mentioned in Amazon’s earnings release: Amazon MGM Studios’ “Melania” documentary, which follows Melania Trump in the 20 days leading up to her husband Donald’s second presidential inauguration. “Melania” premiered Jan. 30 and took in $7 million at the domestic box office from 1,778 theaters over the weekend. While that’s an unusually strong start for a documentary feature, Amazon bought the film for $40 million and then spent a reported $35 million on marketing it.

Amazon did brag that its fourth season of streaming the NFL’s “Thursday Night Football” on Prime Video was the most-watched so far, averaging over 15 million viewers, a 16% increase year-over-year and third consecutive year of double-digit growth. It also said it delivered the most-streamed NFL game to date with more than 31 million viewers who watched the Packers-Bears wildcard playoff game on Jan. 10.

Earlier this week, Amazon boasted that its delivery times to Prime members were the fastest ever in 2025, the third consecutive year it has boosted that metric. In the U.S., Prime members received more than 8 billion items the same or next day, a 30%-plus increase compared with 2024.