Amazon Builds Out the Last Mile and Beyond: Satellites, Third-Party Logistics, and the AI Cost Crackdown

Amazon is quietly reshaping itself from an e-commerce juggernaut into an infrastructure powerhouse with tentacles in space, logistics, and artificial intelligence. The company's latest moves — a blockbuster $11.6 billion acquisition of satellite operator Globalstar, the opening of its delivery network to outside businesses, and an internal clampdown on wasteful AI usage — paint a picture of a conglomerate hedging its bets on multiple growth engines while keeping a tight leash on spending.

The stock has already priced in some of that optimism. Amazon shares closed Friday in Frankfurt at €232.00, down 1.38% on the day but up roughly 20% year to date. The 52-week high of €235.25 is within striking distance, though the relative strength index of 74.1 warns of a technically overheated market. Analysts remain bullish: Truist Financial lifted its price target to $320 from $310, citing robust cloud demand.

A Satellite Bet to Rival Starlink

The headline-grabbing move is Amazon's planned purchase of Globalstar, a deal valued at around $11.6 billion that also includes buying out Apple's 20% stake in the satellite operator. The acquisition dovetails neatly with Project Kuiper, Amazon's bid to build a low-earth-orbit broadband network capable of competing with Starlink.

Progress is accelerating: on Friday, a United Launch Alliance Atlas V rocket launched 29 production satellites from Cape Canaveral, bringing the number of Kuiper satellites in orbit to roughly 300. Amazon faces a regulatory deadline to deploy around 1,600 satellites by mid-2026, making launch cadence critical.

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That timeline faces an unexpected hurdle from within the Bezos orbit. Blue Origin's New Glenn rocket exploded during a static fire test in Florida on Thursday, severely damaging the launch pad. Although no Kuiper hardware was aboard, the incident threatens to delay the roughly 25% of Amazon's booked satellite missions that Blue Origin is contracted to fly. Every postponement pushes back the moment when Kuiper can begin generating meaningful revenue.

Turning Logistics into a Platform

On the ground, Amazon is taking a page from its AWS playbook. The launch of Amazon Supply Chain Services opens the company's logistics network to businesses that don't necessarily sell through Amazon's marketplace, offering global freight, distribution, and fulfillment. The initial $4 billion investment is expected to triple delivery capacity in certain regions by the end of 2026.

Wall Street immediately recognized the threat to incumbent parcel carriers. FedEx shares slid about 9% on the announcement, while UPS lost roughly 10%. The logic is simple: just as Amazon turned internal cloud infrastructure into a $100 billion business, it now hopes to commoditize its delivery muscle into a standalone profit center.

AI: From Tokenmaxxing to Real Metrics

Internally, Amazon is reining in the artificial intelligence arms race. The company scrapped its "KiroRank" internal leaderboard after employees were found to be gaming the system by generating trivial AI queries — a phenomenon dubbed "Tokenmaxxing" — to inflate their scores. Senior Vice President Dave Treadwell has made it clear that teams should use AI for genuine customer or business benefit, not just for the sake of using AI.

Replacing KiroRank is a new metric called "normalized deployments," designed to measure actual code production and business value rather than token consumption. Amazon still wants more than 80% of its developers using AI every week, but it now insists on demonstrable productivity gains.

That discipline is essential given the scale of capital spending. For fiscal 2026, Truist estimates Amazon will invest $202 billion, rising to $263 billion in 2027. The Konzern's first-quarter earnings per share of $2.78 crushed the consensus estimate of $1.63, but heavy upfront spending on data centers, chips, and cloud capacity can compress margins in the near term.

Cloud Momentum and a Healthcare Shuffle

AWS remains the bedrock of the investment thesis. The cloud unit's order backlog stands at roughly $360 billion, underpinned by massive AI partnerships with companies like Anthropic and OpenAI that collectively represent about $100 billion in commitments. These deals give Amazon unusually high revenue visibility over the next several years.

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On the healthcare front, Amazon is bringing in new leadership. Roy Schoenberg, co-founder of telemedicine firm Amwell, will take over Amazon Health Services this summer, overseeing One Medical and Amazon Pharmacy. He replaces Neil Lindsay, who will stay on as an adviser until year-end. The move signals Amazon's intent to professionalize a division that has yet to make a major dent in the $4 trillion U.S. healthcare market.

The Road Ahead

Amazon now operates on multiple fronts: satellite broadband, cloud computing, third-party logistics, and healthcare — each with its own regulatory, technical, and competitive risks. The Blue Origin test failure is a reminder that even well-capitalized space ventures face setbacks. The internal AI cost crackdown shows that not every experiment pays off immediately.

Still, the market is giving management the benefit of the doubt. The next catalyst could come from Prime Day in June, which typically drives a surge in order volume and tests the newly expanded logistics network. If Amazon can accelerate the Kuiper launch tempo, make Supply Chain Services stick, and keep AI spending aligned with measurable returns, the story remains intact. Execution, however, will be the difference between a stock that merely holds its gains and one that breaks out to new highs.

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