Amazon stock drops on gloomy outlook despite strong earnings

Amazon reported fourth-quarter earnings that exceeded analysts' forecasts, primarily fueled by remarkable growth in its cloud services, significant investments in AI, and a strong holiday shopping season. However, the company's cautious outlook for the first quarter led to a nearly 2% drop in its stock in after-hours trading. Investors are particularly concerned about potential slowdowns in cloud growth, a key revenue driver in recent years, particularly as Amazon's web services segment saw a year-on-year revenue increase of 28%.