AWS announces new $5 billion Latin America investment plan By Investing.com

SEATTLE – Amazon Web Services (AWS), the cloud computing arm of Amazon.com, Inc. (NASDAQ:), has announced it will launch an infrastructure region in Mexico by early 2025. This move is part of the company’s long-term investment strategy in Latin America and is expected to exceed $5 billion over the next 15 years.

The new AWS Mexico (Central) Region aims to provide local customers, including government and nonprofit organizations, with lower latency and the option to store data within the country. The upcoming region will consist of three Availability Zones at launch, contributing to AWS’s global footprint of 105 Availability Zones across 33 geographic regions.

The establishment of the AWS Mexico Region is a response to the high demand for cloud services in Latin America and will support the country’s digital transformation and economic growth. It will allow for the deployment of advanced technologies such as artificial intelligence (AI) and machine learning, assisting customers in meeting data residency preferences.

Mexican Secretary of Economy Raquel Buenrostro welcomed the investment, citing it as a sign of trust in Mexico’s ability to support the nearshoring trend. The investment is also expected to foster training for students and digital entrepreneurs in the country.

Several Mexican enterprises have expressed support for the new AWS region, recognizing its potential to enhance their operations. Aeroméxico, Banco Santander (BME:) Mexico, Cinépolis, and Vector Casa de Bolsa are among the companies anticipating improved performance and customer experience with AWS’s expanded local infrastructure.

AWS’s commitment to Mexico includes previous investments such as the launch of seven Amazon CloudFront edge locations, AWS Outposts, AWS Local Zones, and an AWS Direct Connect location in Queretaro. These initiatives aim to bring AWS services closer to end users and support hybrid cloud environments.

In line with its sustainability commitments, Amazon, the parent company of AWS, is working towards reaching net-zero carbon across its operations by 2040 and powering its operations with 100% renewable energy by 2025. AWS also aims to be water positive by 2030.

The announcement is based on a press release statement from Amazon Web Services.

InvestingPro Insights

As Amazon.com, Inc. (NASDAQ:AMZN) gears up to expand its cloud infrastructure in Mexico, the company’s financial health and market performance remain critical to its ambitious growth plans. According to real-time data from InvestingPro, Amazon boasts a hefty market capitalization of $1820.0 billion, underscoring its significant presence in the market. The company’s commitment to innovation and expansion is also reflected in its revenue growth, with a notable increase of 11.83% over the last twelve months as of Q4 2023.

Investors are keeping a keen eye on Amazon’s earnings, with 23 analysts having revised their earnings upwards for the upcoming period, as per InvestingPro Tips. This optimism is echoed in the company’s strong return over the last year, with an impressive 87.16% price total return. These factors are essential for stakeholders considering Amazon’s strategic investments, such as the new AWS Mexico Region, which promises to enhance the company’s service offerings and customer experience in Latin America.

While Amazon is trading at a high earnings multiple, with a P/E ratio of 59.43, this is indicative of the market’s high expectations for the company’s future growth. The company’s stature as a prominent player in the Broadline Retail industry, coupled with its robust revenue figures, grossing $574.78 billion over the last twelve months as of Q4 2023, provides further confidence in its ability to sustain and capitalize on its expansion efforts.

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