Asymmetry Keeps Me Hitting The Buy Button on Amazon

AMZN is up just 7% YTD while AWS grows 37% YoY with a $496 billion backlog, its fastest growth in 18 quarters.

Unlike MSFT or GOOGL, AMZN delivers five straight quarters of AWS acceleration plus an AI and chips run rate each exceeding $25 billion.

Amazon's $200 billion 2026 capex looks painful, but the lion's share of 2027 capacity is already pre-reserved under multi-year contracts.

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I keep buying Amazon ( NASDAQ:AMZN ) because the setup in front of me is the cleanest risk-reward asymmetry I own. The stock is down 5.87% over the past month and up only 6.56% year to date, while the business underneath it just posted the fastest AWS growth in 18 quarters. That gap is why I keep adding.

What Keeps Pulling Me Back to the Buy Button

My thesis is simple. Amazon is spending like a company that sees demand it cannot fill, and the market is pricing it like a company whose free cash flow just went negative. Both statements are true. Only one of them matters in ten years. Trailing-twelve-month free cash flow is -$7.6 billion, and Q2 capital expenditures hit $54.2 billion. That is the near-term pain. On the other side of it sits a data-center footprint management said can be monetized for 30-plus years once online.

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First, AWS is compounding into something larger. Q2 AWS revenue was $42.23 billion, up 37% year over year, with an annualized revenue run rate of $169 billion and a backlog of $496 billion, growing triple digits year over year. Andy Jassy told the Street he now believes AWS can be a "trillion dollar annual revenue business for us in time." The 39.4% AWS operating margin tells me the growth is not being bought with giveaways.

Second, the ad business keeps quietly turning into a monster. Advertising revenue was $19.81 billion, up 26% year over year. That is a high-margin stream layered directly on top of the retail flywheel, and it flows through operating income, which grew 43.24% year over year in Q2.