Amazon (AMZN) stock dropped more than 2% in Tuesday pre-market trading after Amazon Web Services confirmed that drone strikes tied to the Middle East conflict damaged data center facilities in the UAE and Bahrain.
The strikes happened Sunday morning local time. AWS initially posted to its health dashboard that “objects” had hit facilities in the UAE, causing “sparks and fire.”
BREAKING: Amazon Web Services has closed its UAE data center following Iranian strikes.
Bahrain's AWS site is also impacted, causing service outages across the Middle East, Africa, and South Asia.
No word on data losses.pic.twitter.com/sPNySxM8cx
— Financelot (@FinanceLancelot) March 2, 2026
By Monday evening, AWS gave a clearer picture. Two UAE facilities were “directly struck,” while a Bahrain site was taken offline after a nearby strike caused physical damage to infrastructure.
“These strikes have caused structural damage, disrupted power delivery to our infrastructure, and in some cases required fire suppression activities that resulted in additional water damage,” AWS said in a statement.
The damage knocked several key services offline in the affected regions. EC2 virtual servers, S3 object storage, and DynamoDB — the NoSQL database service — all reported elevated error rates and degraded availability.
AWS said DynamoDB error rates “remain elevated” with no “meaningful improvement” seen so far. Lambda, Kinesis, and CloudWatch also “remain degraded.”
The only partial win: AWS managed to restore its Management Console, the web dashboard clients use to manage cloud resources. But even that restoration is incomplete, with some pages still returning error messages.
AWS said recovery will be “prolonged given the nature of the physical damage involved.” Teams are still assessing the full extent of the damage while prioritizing worker safety on the ground.
The company said some data access and service availability can be restored without the facilities being fully back online — and that work is already underway.
AWS is the world’s largest cloud provider, so even a regional outage has a broad customer impact.
The company urged customers with workloads in the Middle East to back up their data and consider migrating to other AWS regions in the U.S., Europe, or Asia Pacific.
AWS also warned that ongoing Middle East instability could make operations in the region “unpredictable” going forward.
Beyond cloud services, Amazon’s retail operations in the region were also affected. The company placed notices on its marketplaces in Israel, Saudi Arabia, Kuwait, Bahrain, and the UAE warning of “extended delivery time in your area.”
The drone strikes came on the same day Iran launched missiles and drones at Israel and U.S.-linked targets across the Gulf, in retaliation for U.S.-Israeli strikes on Iran.
Amazon confirmed the outages were directly tied to that conflict in its Monday evening update — the first time it formally linked the damage to the regional military escalation.
As of the latest update, AWS conditions at the UAE facility “remain largely unchanged,” with teams still working to restore full infrastructure.
Wall Street analysts maintain a Strong Buy consensus on AMZN, with 40 Buy ratings and 3 Holds over the past three months. The average price target sits at $282.21, implying around 35% upside from current levels.
The post Amazon (AMZN) Stock Falls After AWS Data Centers Hit by Drone Strikes in UAE and Bahrain appeared first on CoinCentral.
