Amazon.com, Inc. (AMZN) Faces a $1.2 Trillion AI Spending Question: Will the Investment Pay Off? Attiya Zainib Tue, November 10, 2026 at 4:22 PM EST 3 min read AMZN +1.48% ^GSPC -0.38% Trade AMZN on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Moon Capital Management an investment management company, recently released its Q3 2026 investor letter. A copy of the letter can be downloaded here. The letter reported that its equity portfolio gained approximately 4% during the first nine months of 2026, compared with an approximately 12% year-to-date return for the S&P 500. The firm noted that market gains remained narrow, with nearly half of S&P 500 constituents declining during the period and the median stock gaining only about 4%. Much of the letter focused on AI investment, as major technology companies are expected to spend approximately $1.2 trillion on capital expenditures in 2027 and another $1.4 trillion in 2028. Although the semiconductor industry has benefited from strong demand, with the S&P Global Semiconductor Index rising approximately 95% through September, Moon Capital questioned whether the enormous infrastructure investments would generate adequate returns. The firm has avoided direct AI investments because it remains uncertain which companies will ultimately capture the economic benefits. The firm remains focused on businesses whose economics it can assess with confidence and whose shares trade at meaningful discounts to estimated intrinsic value. In addition, please check the Fund's top five holdings to know its best picks in 2026.
In its third-quarter 2026 investor letter, Moon Capital Management highlighted stocks like Amazon.com, Inc. (NASDAQ:AMZN). Amazon.com, Inc. (NASDAQ:AMZN) is a global technology and e-commerce company operating online and physical retail stores, advertising services, subscription offerings, and Amazon Web Services (AWS). The one-month return of Amazon.com, Inc. (NASDAQ:AMZN) was 1.7% while its shares traded between $198.79 and $284.02 over the last 52 weeks. On November 9th, 2026, Amazon.com, Inc. (NASDAQ:AMZN) stock closed at approximately $266.93 per share, with a market capitalization of $2.93 trillion.
Moon Capital Management stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q3 2026 investor letter:
"The major hyperscalers (including Amazon.com, Inc. (NASDAQ:AMZN)) are now expected to collectively spend approximately $1.2 trillion on capital expenditures in 2027 and another $1.4 trillion in 2028. By some estimates, AI-related investment accounts for roughly 30% of U.S. GDP growth and nearly half of S&P 500 earnings growth this year. The scale of the investment is extraordinary, but whether the eventual returns will justify the capital committed remains to be seen (Click Here To Read The Letter In Detail)."
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In another article, we covered Amazon.com, Inc. (NASDAQ:AMZN) and shared the list of best growth stocks for next decade. In addition, please check out our hedge fund investor letters Q3 2026 page for more investor letters from hedge funds and other leading investors.
This article is originally published at Insider Monkey.
