Amazon shares plummet

Although the company announced double-digit revenue growth in its latest financial report, the stock price still fell 10% and recovered some of its losses after the market closed. The company's financial report showed that AWS revenue in the quarter ended in September was US$46 billion, a year-on-year increase of 39%; total revenue increased by 12% to US$201.9 billion, and net profit was US$20.7 billion. Both data were lower than analyst expectations. "Investors hope to see faster growth, especially in the AWS business," analysts said. "This expectation may be too optimistic." Even more disappointing than the slowdown in growth is the deterioration in cash flow and capital expenditures that worries investors. Amazon's free cash flow reversed from +14.8 billion US dollars in the same period last year to -42.4 billion US dollars; full-year capital expenditures increased to 220 billion US dollars, mainly used for the construction of artificial intelligence data centers. Concerns about overheating investment in computing infrastructure also caused Google's stock to plummet, evaporating $500 billion in market value in one day. Google's search business grew by 12% year-on-year in the third quarter, lower than the 17% in the second quarter and 19% in the first quarter. This highlights that Google is investing heavily in AI on the one hand, but on the other hand, it is facing the embarrassing situation of its search business being cannibalized by AI. "A company that has invested heavily in artificial intelligence to protect its core business has performed disappointingly in the face of the vulnerability exposed by artificial intelligence," market analysts said. Artificial intelligence provides answers directly, bypassing the search link, subverting Google's search business model. What is even more shocking is that the company has experienced negative cash flow that has never been seen since 2005, and the trend has further expanded: the company's capital expenditures in the quarter reached US$51.355 billion, a year-on-year increase of 114.4%; operating income was US$42.3 billion, resulting in the company recording a cash outflow of -US$9 billion in the quarter. The reason why investors allow leading IT companies to spend money like water and invest heavily in computing infrastructure is because the core businesses of Google, Microsoft, and Amazon are reliable cash cows. Companies are scratching their heads, trying to embed ads into AI chat interfaces to carve up hundreds of billions of dollars in advertising revenue. OpenAI began testing advertising functions among some local ChatGPT users in February this year. Its annual revenue is expected to reach 1 billion US dollars and its development momentum