Amazon.com (AMZN) management now leads its calls with AI. It plans about $220 billion of 2026 capital spending. The easy reading is that the stores run themselves while the cloud arm takes the spending. That reading holds only if two things are true. The stores must keep getting cheaper to run, and the cloud arm must earn back what it spends. Did the stores stop getting cheaper to run, or did management just stop leading with them?
Amazon Stopped Leading With Its Cheaper-To-Run Stores
The stores did not stop getting cheaper to run. Management stopped leading its calls with them. In the fiscal Q3 2024 call, management expected more savings from regionalizing outbound delivery. In the fiscal Q4 2024 call, it said the global cost of serving each unit had fallen.
Cost to serve is what it costs Amazon to get each unit to a customer. Regionalization means placing inventory closer to buyers. In the fiscal Q4 2025 call,…
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