Why Amazon Stock Dropped 11% Last Month
Shares of Amazon (NASDAQ: AMZN) dropped 10.7% in February, according to data provided by S&P Global Market Intelligence. The company reported financial results for 2024 on Feb. 6 which handily beat expectations. But investors were concerned about a $100 billion expense coming in the near future.
For context, Amazon just capped off a historic year. The company's operating income came in at a record $68.6 billion, which was up 86% year over year and was almost as much as the previous three years combined. And the star of the show was the cloud-computing platform Amazon Web Services (AWS). AWS supplied more than half of the year's operating income with its net sales growing by 19% to over $100 billion.
Don't misunderstand: Amazon's AWS is one of the most important cloud-computing platforms, and its growth has been stellar for years. But more recently, growth in the industry is getting a boost from interest in artificial intelligence (AI). In short, enterprises are turning to AWS to experiment with and ultimately adopt AI applications.
Source Fool.com
