Amazon AI Ambitions Soar with AWS Growth Hitting 37%
Amazon's (AMZN) AI ambitions have been overshadowed by other prominent names in the sector, but recent growth figures suggest that the company is actually running one of the highest-velocity AI franchises in the market. In its Q2 print, AWS reported a 37% growth, its fastest in 18 quarters, and operating income jumped 43.24% to $27.46 billion.
The company's stock still trades at a discount to Microsoft (MSFT) on trailing earnings, despite comparable cloud momentum. According to our analysis, Amazon's price target is set at $340.77 over the next 12 months, implying a 30.03% upside from its current price of $262.07.
The bull case for Amazon relies heavily on AWS reaccelerating into a demand curve that is largely presold through 2028. If capex-to-revenue conversion begins to show through in 2027 free cash flow, the company's stock could reach even higher prices, up to $391.92 within 12 months.