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By Deborah Mary Sophia

Feb 5 (Reuters) - The pressure is on Amazon.com to deliver on lofty expectations for cloud computing in its fourth-quarter results on Thursday, after Microsoft and Google's dull reports jolted financier faith in Big Tech's billion-dollar investments in AI.

Shares of major tech companies surged in the past two years on the belief that enormous datacenter needs for innovations would power financial investment for many years.

But that was before Chinese start-up DeepSeek said it had attained AI advancements at a portion of the expense, precipitating a selloff in innovation stocks that some state was overdue.

Still, Amazon might be better positioned than competitors to profit from more affordable AI, experts say, due to its huge cloud organization and lower direct exposure to costly large-language designs that power apps like ChatGPT.

Amazon Web Services, thatswhathappened.wiki the world's biggest cloud providers, is anticipated to publish its greatest earnings boost in eight quarters at 19.3%, according to information assembled by LSEG.

But Microsoft and Meta were both required to protect their AI budget last week, and shares of Google-parent Alphabet slumped 8% on Wednesday after it said it would be investing more on capex than analysts prepared for.

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

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

The business was the first huge cloud supplier to embrace 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, oke.zone the second- and third-biggest cloud gamers, has actually stimulated some caution from experts about AWS' performance.

"Microsoft said it was capability constrained, Google said it was capacity constrained. More than likely, Amazon is going to state it might have been capability constrained too and that's why its development rate isn't quite as much as what the market might have expected," said Bob O'Donnell, chief expert at TECHnalysis Research.

Some experts see the weak point at rivals as a sign that Amazon might have caught up in the AI race through efforts including doubling its financial investment in Anthropic and providing a broad choice of AI designs on its cloud platform.

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

The company has maintained a greater appraisal than some of its competitors, with a current forward price-to-earnings ratio of almost 39. Microsoft's forward P/E is 29 and Alphabet's 22.4, according to LSEG information.

RETAIL STRENGTH

The e-commerce giant's results are also likely to gain from a healthy holiday shopping season, cadizpedia.wikanda.es after competing retailers such as Target and a multitude of garments business released rosy forecasts over the previous month.

Amazon's North American sales for the fourth quarter are predicted to rise 9% year-on-year. After a downturn in online sales growth previously this year, analysts state Amazon is primed for yogaasanas.science a rebound in the retail business, which has affected its post-earnings share movements over the past 2 quarters.

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

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

Amazon has actually also attempted to improve delivery times and expanded product merchandise, including its focus on grocery, pharmacy and fashion - relocations analysts say will help move development.

"Most indications are that it was an excellent quarter. There was a good holiday for the consumer therefore there's lots of reason to think Amazon will have done well because side of the organization," Luria said.

(Reporting by Deborah Sophia in Bengaluru; Editing by Pooja Desai)