Mister Squawk

AMZN

I am a very conservative, value-oriented investor.

In early May of 2022 I purchased some Amazon stock. It's done pretty well:

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When I bought it, it had just declined about 40%. The narrative at the time was that during the pandemic, Amazon massively overspent on logistics infrastructure and hiring. I regarded this as a chance to purchase all that infrastructure at a discount; I was confident that Amazon would grow into that footprint.

I was also impressed with Amazon's history of taking internally developed technology and selling it to customers (AWS, Amazon Logistics, Prime Video) and on their consistent ability to innovate at a low cost.

I completely sat out the recent AI investment frenzy (except for some some GE Vernova shares spun off from a 2019 purchase of 'old' GE). No NVIDIA, no Meta Platforms, no Oracle, no Alphabet, and no Microsoft. I didn't believe that the growth rates implied by the stocks' share prices could be sustained, and I didn't care for many of those companies' share structures.

So how do I feel about the recent news that Amazon was planning $200B in capital expenditures to support AI?

In my view, there are three pillars to Amazon's AI strategy:

Another big story in the markets this week was how some new products just released by Anthropic may undermine the business of 'legacy' SAAS companies:

Anthropic once appeared as an also-ran in the chaotic race for AI supremacy. This week, the sophistication of the startup’s products upended the stock market.

A simple set of industry-specific add-ons to its Claude product, including one that performed legal services, triggered a dayslong global stock selloff, from software to legal services, financial data and real estate. Then, Anthropic unveiled Super Bowl ads that taunt rival OpenAI.

On Thursday, Anthropic unleashed its most advanced model yet, capable of synthesizing data and analysis, running teams of coding assistants, and functions akin to product management. Shares of software companies including Salesforce, Intuit and others fell again Thursday, although less precipitously than earlier in the week.

The viral moment for Anthropic’s models “is the most important thing that’s happened in AI since ChatGPT’s launch,” said Dean Ball, a senior fellow at the Foundation for American Innovation who writes an artificial-intelligence newsletter. “It’s infinitely interesting.”

Olson, Bradley. "The Week Anthropic Tanked the Market and Pulled Ahead of Its Rivals" Wall Street Journal, 5 February 2026.

AWS, in addition to being the leading provider of AI compute infrastructure to Anthropic, is also the largest minority investor in the company. Amazon's capital plans will support both increasing direct revenue from Anthropic as it grows and an increase in the value of its investment.

I am very excited about Amazon's spending plans.

Disclaimer: The content in this topic is for informational purposes only and does not constitute financial, investment, or legal advice. Mister Squawk is not a financial advisor. All investment decisions are your own responsibility.