Amazon fell after hours on an ad and retail miss, but guided AWS growth above 40% for 2027 and 2028. Asked whether the stock should be down, Munster separates the stock's reaction from what the AWS guide says about AI demand.
…the like. So again, a lot of this stuff is kind of on the come, and we just don't know how it's going to shake out. But it also places a strong emphasis on how we keep seeing the circular and all the front-end stuff and that sort of thing. But it all points to a lot of competition for NVIDIA. All
right. Let's get Gene Munster in here. I want to get his take on these managing partner deepwater asset management. Gene, always good to see you. Let's start off with Amazon. Do you think that the stock should be down on the back of these earnings?
…the guidance for AWS. This is probably the most bullish data point in AI over the past three or six months of all the data points that we get. And agree, Karen, that Amazon does not do a good job of guidance. Typically, they guide low on operated income and then they usually beat it. Revenue is kind of right on there. But there is some credibility. This is not like Elon type of guidance. And the fact that they went out two years, I can't remember when a company has given guidance out on a segment for two years. And I think that speaks to a confidence. Typically, they only give one quarter, if at all. They'll usually say acceleration, deceleration. This is an over-the-top endorsement to how they think the cloud business is going to play out. That happens with the backlog that Tim's talking about. It happens with everything that Elon was talking about, what they're seeing with the amount of capacity that they're building out. It plays into what…
I mean, you also pair this with what Jassy has said in recent days. I think it was just on Friday in a podcast. He said, in 2027, capacity is largely booked. Significant portion of 2028 is booked. And that is how you get the clarity on the growth rate for 2027 and 2028. So in terms of this decline…
Yeah, there's, I mean, there's two, I'm looking at the bigger picture, the read-through with Amazon. And just one more on the guidance. They got it to number at least 40%, which is higher than what they just printed. And so talk about like acceleration for multiple years. Something bigger is going…
Gene, how about the training chip demand? Is this something, again, should we be worried about NVIDIA? And, you know, everyone's doing their own thing. This isn't a new story, but it does seem like they're seeing all kinds of demand and they're also less of a buyer. So what are your thoughts?