Amazon Stock Plunges Amid AI Spending Concerns and Cash Flow Woes

Amazon's stock price has declined by 4.5% ahead of its July 30 earnings report, raising concerns about the sustainability of its investment-heavy strategy in AI and cloud infrastructure.

The company's aggressive spending on AI engineers and customer relationships has raised questions about whether it will generate sufficient returns to justify the scale of investment.

Amazon's free cash flow has also deteriorated due to increased capital expenditures, putting pressure on cash generation.