Amazon.com Inc.’s stock hit a new high on Tuesday, as the company’s new CEO was greeted by news that the Department of Defense had canceled a $10 billion contract that Microsoft Corp. had secured instead of Amazon. Amazon AMZN, +4.69 percent shares gained 4.7 percent on Tuesday to close at $3,675.74, breaking the previous high of $3,531.45 set on Sept. 2, 2020. The move, which was the highest in the S&P 500 SPX, -0.20 percent on Tuesday, was also Amazon’s best single-day percentage gain since Nov. 4, 2020, the day after the U.S. presidential election. Amazon was worth around $1.85 trillion at the end of the day, trailing just Big Tech’s two $2 trillion behemoths, Apple Inc. AAPL, +1.47 percent and Microsoft Inc. MSFT, +0.00 percent, in terms of market capitalization in the United States.
Not to be missed: The $10 billion JEDI cloud deal was abruptly canceled by the Pentagon. According to Bernstein analyst Mark Moerdler, Amazon was generally expected to win the Department of Defense’s JEDI Cloud contract before it was granted to Microsoft in 2019. Amazon claimed in court that former President Donald Trump influenced the outcome to favor Microsoft because he dislikes Amazon founder Jeff Bezos, who also owns the Washington Post. “Unfortunately, the contract award was not made on the merits of the proposals, but rather as a result of outside interference that has no place in government procurement,” an Amazon representative told MarketWatch, adding that the business agreed with the Pentagon’s decision on Tuesday. For further information, go to: What exactly is Amazon accusing Trump of in the JEDI deal? “It’s evident the DoD trusts Microsoft and our technology,” Microsoft wrote in a blog post on Tuesday. “We are sure that we will continue to be successful when the Department of Defense selects partners for new work,” the company said. The Department of Defense intends to advertise for a new contract, the Joint Warfighter Cloud Capability, in which Amazon and Microsoft will compete. In a note on the decision Tuesday, Raymond James analysts said, “We feel this is a clear win for Amazon and potentially negative for third-party data centers.” “We feel that the move to Amazon solidifies Amazon’s position as a major cloud provider, particularly among government agencies.” Tuesday marked the start of a new era for Amazon as well. On Monday, Bezos announced his departure as CEO, handing over the reins to Andy Jassy. Under Jassy, who formerly led Amazon Web Services and turned it into a cloud behemoth, cloud computing should remain a top priority for Amazon./n
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