Amazon shares climbed as much as 13.5% on Friday after robust cloud business growth reassured investors about the company's heavy AI spending, easing concerns that it was falling behind its Big Tech peers, Reuters reported.The stock jumped $31.77 from its previous close of $235.50 to an intraday high of $272.04, marking one of its sharpest single-day gains.Amazon Web Services posted its fastest growth in more than four years, signalling renewed demand and supporting the company's decision to increase planned capital expenditure for 2026 by 10% to $220 billion.The results offered Wall Street fresh evidence that some of Big Tech's massive AI investments are beginning to generate measurable returns.If the gains hold, Amazon could add more than $340 billion to its market value after reporting a 37% increase in second-quarter cloud revenue. Microsoft shares surged more than 15% earlier this week after its cloud business exceeded estimates with 43% revenue growth.However, investors are becoming increasingly selective about Big Tech's mounting AI expenditure, which is expected to exceed $730 billion this year, according to Reuters."The market is no longer questioning whether AI demand is real. The new dividing line is whether unprecedented spending is producing visible, near-term revenue and margin expansion," Bill Birmingham, managing director at REX Financial, was quoted as saying by the news agency."The market penalises spending when monetisation is delayed, indirect or difficult to measure."Meanwhile, shares of Meta and Google parent Alphabet fell 7% despite strong revenue growth after both companies raised their capital-spending forecasts and reported sharp declines in free cash flow."Amazon is earning the right to keep spending. Where others are asking investors to trust that the payoff will come, Amazon showed it this quarter," said Thomas Monteiro, senior analyst at Investing.com."As long as AWS keeps accelerating and margins hold, the market looks willing to fund the build-out, even with free cash flow in the red."Amazon reported negative trailing 12-month free cash flow of $7.6 billion in the second quarter, compared with positive free cash flow of $18.2 billion a year earlier.However, CEO Andy Jassy reassured investors that Amazon is only pouring money into serving demand that already exists. He said a majority of available Amazon cloud capacity for 2027 and some capacity for 2028 had already been reserved by customers(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)