Amazon’s bank account is sitting pretty, with last year’s record free cash flow projected to nearly double to $62B this year. This could leave the retail giant with almost $100B in cash by the end of 2024. Investors are now wondering: What will Amazon do with all that money? As two possibilities gain traction, investors have propelled the stock to new highs.
- Unlike some tech giants, Amazon hasn’t pursued stock buybacks for two years — so analysts consider it a feasible option.
- Analysts also expect that the company may declare a quarterly dividend, following in the footsteps of Meta, Microsoft, and Apple.
One place they’re spending big: With the FTC cracking down on Big Tech acquisitions, Amazon is pouring resources into AI — recently announcing a plan to spend $150B over the next 15 years to upgrade its data centers for AI apps and services. Amazon expects AI to enhance its cloud services division, which accounted for 14% of its revenue last quarter, a key factor driving the stock’s upward trajectory. But despite the cash reserves and cloud optimism, the division is still cutting jobs.
