Did the purchases of property and equipment of Amazon for the quarter ended September 30, 2026 come to at or above 28.0% of its revenue?
Divide the purchases of property and equipment by the revenue that Amazon reports for the quarter ended September 30, 2026 in its 10-Q or 10-K filing on SEC EDGAR. The answer is yes if the ratio is at or above 28.0%; no if it is below 28.0%.
If the source is late or silent: If Amazon has not filed by November 16, 2026, or a filing restates a period the rule reads, the test is inconclusive, and the Result says what was read and what was missing.
If no
Returns on AI capital clear their cost of capital
Expects AI revenue growth to justify ever larger capital spending, pushing the capex share of revenue higher as the buildout pays off.
If yes
Returns on AI capital fail to clear their cost of capital
Expects capex to outrun revenue growth as costs rise and AI pricing falls, keeping spending below the 28 percent mark.
50%
NoYes
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The trail · since Oct 22
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The case · 6 people · 2 minutes
Returns on AI capital clear their cost of capital1 people argue noReturns on AI capital fail to clear their cost of capital5 people argue yes
Hyperscaler capex turns ROI positive at roughly 1.7-1.8x revenue-to-depreciation ratio with 8% cost of capital, 30% operating margin, and 5-year depreciation. Currently at 1.2x with only 3-4% of global population paying for AI. As paying population…
Stronger if yes · 5 people
Returns on AI capital fail to clear their cost of capital
Capex is spent now while the revenue it must earn depends on consumers and businesses absorbing an unprecedented amount of new AI spending within about four years; if that revenue arrives late or short, the return arithmetic falls below the cost of…
What would change the Call
A surge or slowdown in AI data center spending relative to revenue growth would move the ratio across 28.0 percent.
The Call · Thesis 36 · Returns on AI capital fail to clear their cost of capital
The house leans to "Returns on AI capital fail to clear their cost of capital".
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The thesis
Will combined disclosed AI-attributed annualized revenue across the major US AI providers reach $300bn by the end of 2027 as reported in public filings or earnings disclosures?
AI revenue scales fast enough that the revenue-to-depreciation ratio on AI infrastructure rises toward the level where returns clear an 8-10% cost of capital, contradicting the value-destruction case that argues capex outruns the revenue needed to earn it back.