Amazon to invest $200 billion in AI as Washington Post announces major layoffs

Amazon said it will spend $200 billion in 2026, marking an increase of more than 50 per cent from last year, as it ramps up investment in artificial intelligence, robotics, and related infrastructure.

The announcement came a day after The Washington Post, owned by Amazon founder Jeff Bezos, said it would cut about one-third of its workforce.

Amazon chief executive Andy Jassy said the company would raise capital spending to $200 billion from $125 billion, with funds directed toward building AI infrastructure, developing custom chips, expanding robotics capabilities, and investing in low-earth-orbit satellites.

He said the company sees an unusual opportunity to significantly expand Amazon Web Services and Amazon as a whole and plans to invest aggressively to lead in the AI space.

Most of the spending will go into AWS, which provides cloud services to companies, governments, and apps, with a large share earmarked to support AI workloads. Amazon reported revenue of $213 billion, although its fourth-quarter earnings fell slightly short of Wall Street expectations.

The company warned that the heavy spending would weigh on profits in the near term. For the current quarter, Amazon expects income between $16.5 billion and $21.5 billion, below analysts’ average estimate of $22.2 billion. Amazon shares fell about 10 percent after the markets closed and had already declined 3.5 percent earlier this year.

AWS posted strong results, with revenue rising 24 per cent to $35.6 billion, its fastest quarterly growth in more than three years, and operating income of $12.5 billion.

The Washington Post said the layoffs would affect more than 300 journalists. Executive editor Matt Murray told staff the paper had been losing money for a long time and would now focus more on national news, politics, business, and health, while shutting its sports and books sections and scaling back international coverage.