Downstream Segment “Drags Behind”: Shell Issues Q4 Profit Warning, Upstream Gains Offset

As the AI sector experienced a sharp sell-off in late October, a routine disclosure document from Elon Musk's SpaceX brought a structural flaw, previously masked by rapid growth, into the spotlight.

CEO Jassy expects AWS growth to exceed 40% in 2027 and 2028 and aims to reach a “trillion-dollar” revenue scale within 5-10 years. Addressing this year’s capital expenditure of as much as $220 billion, Jassy stated that AI is a “once-in-a-lifetime opportunity that will permanently change the scale of Amazon.” The company plans to offer computing power chips for external sales by the end of next year. In terms of e-commerce, the management emphasized that after excluding the impact of Prime Day timing mismatches, North American and international businesses still maintain growth rates of 6% and 8%, respectively.

Amazon AWS accelerated growth for the sixth consecutive quarter to 39%, but e-commerce online sales growth dropped to a three-year low. Advertising growth hit a record low, capital expenditures far exceeded expectations, and free cash flow over the past 12 months turned negative to -$42.4 billion. The stock price plunged after hours, resonating with Alphabet's 13% drop on the same day, as market concerns over the imbalance between tech giants' AI investments and core business growth are intensifying.