By Deborah Mary Sophia

Feb 5 (Reuters) - The pressure is on Amazon.com to provide on lofty expectations for cloud computing in its fourth-quarter outcomes on Thursday, after Microsoft and Google's dull reports jolted investor mediawiki1334.00web.net faith in Big Tech's billion-dollar financial investments in AI.

Shares of significant tech business surged in the previous 2 years on the belief that enormous datacenter requires for artificial-intelligence technologies would power investment for many years.

But that was before Chinese start-up DeepSeek said it had attained AI developments at a fraction of the cost, precipitating a selloff in technology stocks that some say was overdue.

Still, Amazon may be better positioned than competitors to take advantage of more affordable AI, analysts say, due to its massive cloud company and lower exposure to expensive large-language models that power apps like ChatGPT.

Amazon Web Services, the world's largest cloud services service provider, is expected to post its greatest revenue increase in eight quarters at 19.3%, according to data assembled by LSEG.

But Microsoft and Meta were both required to protect their AI spending plans recently, and shares of Google-parent Alphabet dropped 8% on Wednesday after it said it would be investing more on capex than analysts anticipated.

"Microsoft and Google results have actually put much more of a microscope on Amazon's cloud development," said Dave Wagner, portfolio supervisor at Aptus Capital Advisors, which holds shares in all 3 technology companies.

"But if Amazon can squash it on their cloud numbers, the market's going to definitely love that report."

The company was the very first big cloud supplier to accept DeepSeek's AI models last month and has said its capital costs, mainly on AI, would be more than the $75 billion it approximated for 2024.

Slowing growth at Microsoft Azure and Google Cloud, the second- and third-biggest cloud players, has stimulated some caution from experts about AWS' efficiency.

"Microsoft said it was capacity constrained, Google said it was capacity constrained. More than likely, Amazon is going to say it might have been capability constrained as well and that's why its growth rate isn't rather approximately what the market may have anticipated," said Bob O'Donnell, primary expert at TECHnalysis Research.

Some experts see the weak point at rivals as an indication that Amazon may have caught up in the AI race through efforts consisting of doubling its investment in Anthropic and offering a wide selection of AI designs on its cloud platform.

"We really believe that AWS is regaining share. It had actually been growing a lot slower than Microsoft Azure and Google Cloud for a time period, however we think that as Amazon has captured up on its AI offering, it might have less of a deceleration than Azure and Google Cloud," D.A. Davidson expert Gil Luria said.

The business has actually maintained a greater appraisal than a few of its rivals, with a price-to-earnings ratio of nearly 39. Microsoft's forward P/E is 29 and Alphabet's 22.4, bryggeriklubben.se according to LSEG data.

RETAIL STRENGTH

The e-commerce giant's outcomes are likewise most likely to gain from a healthy vacation shopping season, after competing retailers such as Target and a variety of apparel business issued rosy projections over the previous month.

Amazon's North American sales for the fourth quarter are predicted to rise 9% year-on-year. After a slowdown in online sales development earlier this year, experts state Amazon is primed for oke.zone a rebound in the retail organization, which has affected its post-earnings share motions over the previous two quarters.

Data from Adobe Analytics revealed U.S. buyers splurged online in between November and December 2024, investing more than $240 billion, drawn by deep discounts on whatever from TVs to toys.

The vacation spending growth rate of 8.7% nearly doubled from the 4.9% taped in 2023, the information showed.

Amazon has actually also attempted to improve shipment times and expanded item merchandise, including its concentrate on grocery, pharmacy and fashion - relocations experts say will help move growth.

"Most indicators are that it was a great quarter. There was an excellent holiday for the consumer and so there's plenty of factor to think Amazon will have succeeded because side of the business," Luria said.

(Reporting by Deborah Sophia in Bengaluru