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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 outcomes on Thursday, after Microsoft and Google's dull reports jolted investor faith in Big Tech's billion-dollar financial investments in AI.

Shares of major tech companies surged in the previous two years on the belief that enormous datacenter requires for artificial-intelligence innovations would power investment for many years.

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

Still, Amazon might be better located than competitors to take advantage of more affordable AI, experts state, due to its enormous cloud business and lower direct exposure to costly large-language models that power apps like ChatGPT.

Amazon Web Services, the world's biggest cloud companies, is anticipated to post its greatest earnings increase in 8 quarters at 19.3%, according to information compiled by LSEG.

But Microsoft and Meta were both required to their AI spending strategies recently, and shares of Google-parent Alphabet dropped 8% on Wednesday after it said it would be spending more on capex than experts prepared for.

"Microsoft and Google results have actually put a lot more of a microscopic lense on Amazon's cloud development," said Dave Wagner, portfolio supervisor at Aptus Capital Advisors, which holds shares in all three innovation business.

"But if Amazon can crush it on their cloud numbers, the market's going to absolutely enjoy that report."

The business was the first big cloud company to accept DeepSeek's AI designs last month and has said its capital costs, oke.zone mainly on AI, would be more than the $75 billion it estimated for 2024.

Slowing development at Microsoft Azure and Google Cloud, the 2nd- and third-biggest cloud players, has actually sparked some care 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 may have been capability constrained also which's why its development rate isn't quite up to what the marketplace might have expected," said Bob O'Donnell, chief expert at TECHnalysis Research.

Some experts see the weakness at rivals as a sign that Amazon may have captured up in the AI race through efforts including doubling its investment in Anthropic and offering a broad choice of AI models on its cloud platform.

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

The business has actually maintained a greater appraisal than some of its competitors, with an existing forward price-to-earnings ratio of almost 39. Microsoft's forward P/E is 29 and Alphabet's 22.4, wiki.rolandradio.net according to LSEG data.

RETAIL STRENGTH

The e-commerce giant's outcomes are also most likely to gain from a healthy holiday shopping season, after competing retailers such as Target and a slew of garments companies provided rosy forecasts over the past month.

Amazon's North American sales for the 4th quarter are projected to rise 9% year-on-year. After a slowdown in online sales growth previously this year, analysts state Amazon is primed for king-wifi.win a rebound in the retail business, hikvisiondb.webcam which has affected its post-earnings share motions over the past 2 quarters.

Data from Adobe Analytics showed U.S. buyers splurged online in between November and championsleage.review December 2024, spending more than $240 billion, drawn by deep discounts on everything from TVs to toys.

The vacation costs growth rate of 8.7% almost doubled from the 4.9% recorded in 2023, the data revealed.

Amazon has also attempted to enhance delivery times and expanded item merchandise, including its focus on grocery, drug store and fashion - relocations analysts state will help propel growth.

"Most indicators are that it was a good quarter. There was an excellent holiday for the customer and so there's a lot of factor to think Amazon will have succeeded in that side of the service," Luria said.

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