Amazon's aggressive AI infrastructure buildout is pushing it deeper into debt, making it more vulnerable to rising...

Amazon's aggressive AI infrastructure buildout is pushing it deeper into debt, making it more vulnerable to rising interest rates. According to a CNBC report (https://www.cnbc.com/2026/06/20/ai-buildout-giving-tech-investors-new-reasons-to-watch-bond-market.html), Amazon is expected to spend roughly $200 billion on capex this year, with negative free cash flow widely anticipated. This marks a shift from its historically strong cash position, as the company joins other hyperscalers in leveraging debt to fund data center construction. Federal Reserve Chairman Kevin Warsh's recent hawkish stance—signaling a possible rate hike—raises the cost of that borrowing. Chief Investment Officer Peter Boockvar noted that 'tech investors are not as used to looking at rates' but now must pay attention. The article also highlights that combined capex from Amazon, Alphabet, Microsoft, and Meta could hit $750 billion in 2026, up 80% from 2025, with much of it debt-financed. Nvidia, despite its strong cash position, also issued debt. For Amazon, the reliance on debt and negative free cash flow could pressure its stock if rates continue to rise, potentially affecting its ability to compete in the AI infrastructure race. This signal is supported by the cited CNBC analysis and analyst commentary.