• YTD price change for Amazon stock: 5%
• $AMZN Stock Price as of Apr. 10: $238
• 52-Week High: $259
• $AMZN Stock Price Target: $281

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Amazon (AMZN) stock has gained only about 5% this year, and Needham analyst Laura Martin thinks she knows part of the reason.

In a note Friday, Martin maintained her Buy rating and $265 price target on Amazon but raised a pointed concern about how the company is spending its money.

The issue is capital expenditure.

• Amazon is asking for nearly $200 billion in capex for fiscal year 2026.
• Martin’s research suggests every other major hyperscaler — Microsoft, Google, Meta — is funding its 2026 capex from free cash flow. Amazon is not.

CEO Andy Jassy defended the spending in his shareholder letter, arguing that building long-term value doesn’t happen in a straight line and that AI will eventually reinvent every customer experience.

AMZN stock Q4 earnings backed up the growth story —

• AWS revenue hit $35.6 billion, up 24% year-over-year, and
• Backlog stood at $244 billion, up 40% from a year ago.

But Martin’s concern isn’t with the AI spending.

• She estimates roughly 70% of Amazon’s 2026 capex is AI-related.
• Her issue is with the other 30%.
• Amazon is also funding satellites, same-day delivery expansion, pharmacy, perishables, and logistics — businesses that could themselves be disrupted by AI over time.

See analysts’ growth forecasts and price targets for Amazon stock (It’s free) >>>

Martin’s argument is straightforward: if AI changes everything, then pouring capital into the businesses AI might disrupt is a poor use of money right now.

• Her view is that Amazon should pause non-AI capex until it’s clearer which legacy segments will survive the shift.
• She also proposed a new standard — a 20% minimum return on investment for every dollar of capex, with anything falling below that threshold delayed for 2 to 3 years until the AI buildout is complete.

It’s a reasonable critique on paper. But Jassy’s counterpoint has some merit too.

• AMZN weakness may reflect impatience more than a fundamental flaw in the strategy.
• AWS is growing at 24% on a $142 billion annualized base — a number that’s hard to dismiss. And
• Jassy’s track record of making big bets that eventually pay off is well established.

The real question for Amazon stock is whether the market will give the company time to prove the non-AI investments were worth making.

Right now, with the stock barely up on the year, patience appears to be wearing thin.

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Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!