An increase in Amazon Web Services spending cut into the cloud giant’s profits in the second quarter as AWS raced to meet demand for AI against Microsoft, Google, and others.

Amazon.com Inc. projected operating income in the current quarter that fell short of analysts’ estimates, worrying investors that the tech giant is spending too much to keep up with competitors in the race for artificial intelligence.

LONDON (Reuters) -Amazon shares fell 7% on Friday in Europe after the company delivered an upbeat outlook for third-quarter sales, but missed expectations for its cloud computing unit, after its competitors easily beat Wall Street forecasts.

Amazon and Microsoft's dominant position in cloud computing is having an adverse effect on competition, exacerbated by technical and commercial barriers to switching, an inquiry group from Britain's antitrust regulator said.

Britain’s competition regulator called for a probe into Microsoft and Amazon’s cloud market dominance under the country’s strict new tech rules.