Here’s a summary of the article “Amazon has paused some data center lease commitments, Wells Fargo says” from AOL:
- Amazon has delayed some commitments around new data center leases, according to Wells Fargo analysts, which signals that economic concerns may be affecting tech companies’ capital spending.
- The report comes after a Microsoft executive similarly indicated the company is slowing or temporarily pausing early data center build-outs.
- AWS (Amazon Web Services) and Microsoft are the two leading cloud infrastructure providers and have significantly ramped up capital expenditures in recent quarters, largely to address demand from generative AI.
- Wells Fargo states industry sources confirm AWS has paused some international colocation leasing discussions. These moves are not outright cancellations of signed deals but indicate a reevaluation or slowing of some new projects.
- The broader tech sector has been under pressure due to concerns about proposed tariffs and the rising cost of importing equipment, as well as big commitments to investing in GPUs and new data centers.
- Both Amazon and Microsoft report quarterly results soon, with both companies’ stock prices having fallen so far this year.
- Amazon CEO Andy Jassy recently told CNBC that he does not foresee the company reducing its data center construction yet.
- Wells Fargo maintains a “hold” rating on Amazon shares.
Source: AOL.com Amazon has paused some data center lease commitments, Wells Fargo says
