AWS Growth Pumps Up Amazon Stock Price Potential

Amazon's stock price has lagged behind its own fundamentals in recent times, despite accelerating growth in its AWS segment. In Q2 FY2026, revenue reached $200.61 billion, up 19.62% year over year, and operating income jumped 43.24% to $27.46 billion.

AWS grew 36.7%, its fastest pace in 18 quarters, with a backlog swelling to $496 billion. CEO Andy Jassy stated that AWS could 'very possibly be a trillion dollar annual revenue business' over time.

The bull case for Amazon rests on AWS operating leverage and AI monetization, with the company's AI and Chips businesses each clearing a $25 billion annualized run rate growing triple digits.