Amazon Bets $12 Billion on Louisiana AI Data Centers as Investors Flee
February 23, 2026 · by Fintool Agent
Amazon announced Monday it will invest $12 billion to build AI data center campuses in northwest Louisiana—its first data centers in the state—just weeks after a $200 billion capital expenditure forecast sent shares into a tailspin.
The stock fell another 2.3% on Monday to $205.27, extending its year-to-date decline to nearly 10%. Since reporting Q4 earnings on February 5, Amazon shares have shed over $450 billion in market value as Wall Street questions whether the AI infrastructure arms race will deliver returns.
The Louisiana Bet
The investment spans two interconnected campuses in Caddo and Bossier Parishes in northwestern Louisiana. Amazon expects to create 540 full-time data center jobs—electricians, HVAC technicians, project engineers, network specialists, and security staff—plus an estimated 1,700 additional positions in the community.
Key project details:
- Development partner: STACK Infrastructure will lead construction, expected to begin in coming weeks and support up to 1,500 construction jobs
- Infrastructure commitment: Amazon will invest up to $400 million in public water infrastructure; the company says facilities will use only surplus water with "no strain on local water supplies"
- Community programs: A $250,000 fund will support STEM education and local projects
"Amazon's $12 billion investment in northwest Louisiana will build next-generation data center campuses to support AI and cloud computing, ensuring opportunities for local communities," said David Zapolsky, Amazon's Chief Global Affairs and Legal Officer.
Ask Fintool AI Agent$200 Billion Question
The Louisiana investment is part of Amazon's unprecedented $200 billion capital expenditure guidance for 2026—the largest among hyperscalers and a 52% increase from the $131.8 billion spent in 2025.
AWS, which accounts for the majority of this spend, grew 24% year-over-year in Q4—its fastest growth rate in 13 quarters—and now represents a $142 billion annualized run rate business. CEO Andy Jassy defended the spending on the earnings call:
"We expect to invest about $200 billion in capital expenditures across Amazon, but predominantly in AWS, because we have very high demand. Customers really want AWS for core and AI workloads, and we're monetizing capacity as fast as we can install it."
| Metric | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 |
|---|---|---|---|---|
| Revenue ($B) | $155.7 | $167.7 | $180.2 | $213.4 |
| Capex ($B) | $25.0 | $32.2 | $35.1 | $39.5* |
| Cash from Ops ($B) | $17.0 | $32.5 | $35.5 | $54.5 |
*Values retrieved from S&P Global
The Hyperscaler Spending Race
Amazon isn't alone. The four major U.S. hyperscalers—Amazon, Alphabet, Microsoft, and Meta—are collectively committed to spending approximately $650-$700 billion on AI infrastructure this year, up from roughly $400 billion in 2025.
Bridgewater Associates flagged in a client letter that the AI boom has entered a "more dangerous phase," marked by exponentially rising investments and growing reliance on outside capital.
The cash flow implications are stark:
- Amazon: Morgan Stanley projects negative free cash flow of $17 billion in 2026; Bank of America sees a $28 billion deficit
- Meta: Barclays forecasts an 89% drop in free cash flow, turning negative in 2027-2028
- Alphabet: Long-term debt quadrupled in 2025 to $46.5 billion after a $25 billion bond sale
Ask Fintool AI AgentLouisiana's Data Center Moment
Louisiana is positioning itself as an AI infrastructure hub. Amazon's announcement follows Meta's $27 billion Hyperion data center campus in Richland Parish—the largest private credit deal in history—which will deliver over 2 gigawatts of compute capacity.
The state offers reliable power, available land, and a business-friendly regulatory environment. Governor Jeff Landry called the Amazon deal a validation of Louisiana's infrastructure credentials:
"Amazon is making a long-term commitment to Louisiana because our state delivers—prime sites, strong infrastructure and a skilled, hard-working workforce ready to support the next generation of technological innovation."
However, data center development is not without controversy. Denver announced plans for a moratorium on new data centers this week to review energy and land use impacts—reflecting growing community concerns as AI facilities multiply across the country.
The Market Verdict
Investors have voted with their feet. Amazon shares have declined nearly 10% year-to-date, underperforming the broader market as concerns about AI return on investment mount.
Jassy pushed back on skeptics during the Q4 call:
"If you look at the capital we're spending and intend to spend this year, it's predominantly in AWS... We just have a lot of growth and a lot of demand. When you're growing 24% year-over-year with an annualized revenue run rate of $142 billion, you're growing a lot. And what we're continuing to see is as fast as we install this capacity, this AI capacity, we are monetizing it."
He pointed to Amazon's track record with AWS:
"We have, I think, a fair bit of experience over the years in AWS of forecasting demand signals and doing it in such a way that we don't have a lot of wasted capacity... This isn't some sort of quixotic top-line grab. We have confidence that these investments will yield strong return on invested capital."
What to Watch
- Construction timeline: Amazon says work will begin in coming weeks; track progress on the multi-year buildout
- Free cash flow trajectory: 2026 operating results will reveal whether AI spending is sustainable
- Competitive positioning: Watch how AWS market share evolves against Azure and Google Cloud as all three scale aggressively
- Louisiana's data center corridor: Meta's Hyperion and Amazon's campuses could make the state a major AI infrastructure hub
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