Amazon (AMZN, Financial) shares fell more than 3% Monday after Wells Fargo reported the company has slowed certain data center leasing discussions, particularly on international colocation projects. Analyst Eric Luebchow said the company is not canceling existing agreements, but rather pausing a pipeline of lease negotiations involving early-stage agreements such as letters of intent.
The pullback appears similar to Microsoft's recent leasing moderation, with both companies said to be reassessing large commitments following a period of aggressive growth. Luebchow described the move as a possible “digestion” phase, noting that Amazon may resume seeking capacity within 6 to 12 months.
Amazon Web Services executive Kevin Miller responded on LinkedIn, referring to the move as part of "routine capacity management," emphasizing that AWS has not altered its broader expansion strategy.
Despite this moderation from Amazon and Microsoft, other hyperscalers—namely Google (GOOG, Financial), Meta (META, Financial), Oracle (ORCL, Financial), and Nvidia (NVDA, Financial)—are reportedly continuing data center leasing activity at strong levels.
