$AMZN Jessy spitting out how capex works, maybe the market will understand now ?

"Datacenter capital is spent starting two years before we can put servers into them to start monetizing. Once a data center opens with servers plugged in, we start generating significant revenue right away and then get to monetize these data centers for 30+ years without having tospend that startup capital again. Servers and networking equipment operate on a shorter cycle.

We typically purchase these a few months before putting them into service, so we have strong visibility into customer demand before we trigger the spend. If the demand isn't there, we won't spend the capital.

For servers and networking equipment, on average, it takes a little less than three years to break even on that investment. The servers currently have a useful life of at least five to six years, and most of our AI capacity these days is being contracted for at least five-year terms. That means that we're driving significant free cash flow on the servers and networking equipment in the two to three years after we break even.

It's also worth noting that AWS has a strong track record of pulling forward break evens on server equipment where we've already made meaningful progress and finding ways to extend the useful life of this equipment without sacrificing customer experience.

For our data centers, which have 30+ year useful lives, we should get at least five to six generations of server economics, like I explained earlier, with subsequent generations after the first having even better overall economics because we don't have to repeat that upfront data center investment I mentioned earlier. This means in the short term, when demand is necessitating so many data centers being built simultaneously in advance of when we can start monetizing them, we'll spend a lot of CapEx and encounter free cash flow headwinds until these data centers come online, can be monetized, and we get a few years into these servers being utilized.

As we get a few years out and the revenue growth outpaces the incremental CapEx growth, which will happen at some point, the resulting revenue, free cash flow, and return on invested capital is very compelling.

We've done this before in the first era of cloud computing, just over a longer time horizon, where demand built more gradually than it has in AI. We see the margins and returns in AI tracking what we saw with Core at the same point of evolution, actually a little ahead.

We now believe we will spend approximately $220 billion in cash CapEx in 2026. Even at that amount, we will still not have enough capacity to meet all the demand we have in 2026, and I believe this dynamic will also be true in 2027, too. In fact, the demand we already have for 2028 is striking. Remember, enterprises are still very early in using inference at scale in their current production applications."