Amazon's week took a dramatic turn from turmoil to triumph, as the company transformed investor sentiment in just 48 hours. The shift began Tuesday with the announcement of 14,000 job cuts — a move that sparked immediate concern about Amazon’s culture, leadership, and lagging AI progress. At the time, Wall Street questioned whether the layoffs signaled deeper problems, especially as Amazon had been labeled an "AI laggard" by top analysts and continued to underperform its peers over the past five years. Investors were particularly worried about Amazon Web Services, the company’s high-margin cloud division, whose growth had slowed compared to Microsoft Azure and Google Cloud. Despite AWS’s dominant revenue base, its expansion had stalled, raising doubts about its ability to maintain leadership in the evolving AI era. But by Thursday, Amazon delivered a powerful earnings report that reversed the narrative. Third-quarter results beat expectations, with AWS revenue reaching $33 billion — a 20% year-over-year increase, the fastest growth since 2022. More importantly, Amazon raised its capital spending forecast, signaling strong confidence in future demand. The company highlighted several key AI milestones that reassured investors: Trainium 2, AWS’s custom AI chip, has become a "multi-billion dollar" business with rising demand. Connect, AWS’s cloud-based call center software, is on track to hit $1 billion in annual revenue. Rufus, Amazon’s AI shopping assistant, is projected to drive over $10 billion in indirect sales. Bedrock, AWS’s AI development platform, could one day rival EC2, the company’s flagship service in terms of scale and revenue potential. AWS added more than 3.8 gigawatts of power capacity in the last year and plans to double its power capacity by 2027. The cloud unit’s backlog — contracts not yet counted as revenue — surged to $200 billion, excluding new deals signed in October that already exceeded the entire third-quarter volume. Wall Street responded with enthusiasm. Analysts called the results a turning point. Evercore’s Mark Mahaney declared, “The AWS unlock is here.” William Blair described it as “a key step in reclaiming the narrative,” while Barclays noted that the past two days had done more to ease concerns than months of speculation. CEO Andy Jassy emphasized AWS’s momentum during the earnings call, stating, “AWS is gaining momentum.” Still, challenges remain. Amazon has been slower than Microsoft and Google in commercializing AI, and some of its AI products have struggled to gain traction. Jassy also avoided directly answering how much of AWS’s growth stemmed from AI versus traditional infrastructure, fueling lingering skepticism. Moreover, the layoffs may not be over. Jassy clarified that the cuts were driven by cultural alignment and operational efficiency, not cost-cutting or AI automation, suggesting more changes could be on the horizon. Despite the uncertainty, the market’s reaction was clear: Amazon has reasserted its strategic direction. The stock hit record highs Friday, reflecting renewed confidence in Jassy’s leadership and AWS’s ability to adapt in the age of AI.