Amazon Reports 14% Sales Growth, Surpassing Walmart
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Should l Buy AMZN?
Source: NASDAQ.COM
- Significant Sales Growth: Amazon achieved a 14% increase in sales during the fourth quarter, reaching nearly $717 billion, successfully surpassing Walmart to become the largest company in the world by sales, demonstrating its strong competitive position in the market.
- Diversified Investment Strategy: Amazon is investing not only in artificial intelligence but also planning to launch a new type of big-box store that combines retail and distribution, aiming to further expand market share and enhance operational efficiency.
- Strong Performance Across Segments: Online store sales grew by 10% year-over-year, advertising sales increased by 23%, and AWS sales rose by 24%, indicating robust growth across multiple sectors, which strengthens Amazon's market leadership.
- Changing Market Competition Landscape: Walmart would need an additional $14 billion in sales growth to surpass Amazon, highlighting that Amazon is likely to maintain its leading position in future market competition, further solidifying its market advantage.
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Analyst Views on AMZN
Wall Street analysts forecast AMZN stock price to rise
47 Analyst Rating
46 Buy
1 Hold
0 Sell
Strong Buy
Current: 199.600
Low
250.00
Averages
294.69
High
340.00
Current: 199.600
Low
250.00
Averages
294.69
High
340.00
About AMZN
Amazon.com, Inc. provides a range of products and services to customers. The products offered through its stores include merchandise and content it has purchased for resale and products offered by third-party sellers. The Company’s segments include North America, International and Amazon Web Services (AWS). It serves consumers through its online and physical stores and focuses on selection, price, and convenience. Customers access its offerings through its websites, mobile apps, Alexa, devices, streaming, and physically visiting its stores. It also manufactures and sells electronic devices, including Kindle, Fire tablet, Fire TV, Echo, Ring, Blink, and eero, and develops and produces media content. It serves developers and enterprises of all sizes, including start-ups, government agencies, and academic institutions, through AWS, which offers a set of on-demand technology services, including compute, storage, database, analytics, and machine learning, and other services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Strong Financial Results: Despite narrowly missing earnings expectations, Amazon reported a 14% year-over-year revenue increase to $213 billion in Q4, driven by robust growth in advertising and cloud computing, highlighting the company's competitive position in rapidly growing markets.
- Capital Expenditure Plans: Amazon plans to increase capital expenditures to $200 billion by 2026, a 56% rise from $128 billion in 2025, raising investor concerns about the company's financial health, particularly regarding its significant investments in AI infrastructure.
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See More
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- Valuation Pullback Justified: Despite significant revenue and earnings growth, Amazon's stock has declined by approximately 7% since 2025, with its PE ratio dropping to 26.5 times, reflecting a market reassessment of its valuation, potentially providing a reasonable buying opportunity for investors.
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See More
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- AWS Revenue Growth: Amazon Web Services (AWS) achieved a 24% revenue growth over the past year, reaching $35.6 billion, with expectations for continued acceleration driven by surging demand from AI startups.
- Record Operating Earnings: Despite declining free cash flow due to infrastructure investments, Amazon's operating earnings hit a record high of $85 billion over the last 12 months, showcasing strong performance in both retail and cloud businesses.
- Long-Term Growth Potential: If Amazon can achieve a 15% annual revenue growth over the next three years, its revenue could exceed $1 trillion by 2030, with a 15% profit margin translating to $150 billion in net earnings, nearly double current levels.
See More
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- AWS Revenue Growth: Amazon Web Services (AWS) achieved a 24% year-over-year revenue growth to $35.6 billion, with expectations for continued demand, particularly driven by spending needs from artificial intelligence startups.
- Record Operating Earnings: Despite declining free cash flow due to infrastructure investments, Amazon's operating earnings reached a historic high of $85 billion over the past 12 months, indicating expanding margins in both its retail operations and AWS.
- Long-Term Growth Potential: If Amazon can achieve a 15% annual revenue growth over the next three years, it is projected to exceed $1 trillion in revenue by 2030, with a 15% profit margin translating to $150 billion in net earnings, nearly double current levels.
See More
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- AWS Revenue Growth: Amazon Web Services (AWS) saw a 24% year-over-year revenue increase to $35.6 billion, with expectations for continued demand, particularly from AI startups, further driving the company's revenue growth.
- Operating Earnings Performance: Despite heavy upfront investments, Amazon's operating earnings reached a record high of $85 billion over the past 12 months, reflecting margin expansion in retail and strong AWS performance, with this trend expected to continue into 2026.
- Long-Term Growth Potential: If Amazon achieves a 15% annual revenue growth over the next three years, it could exceed $1 trillion in revenue by 2030, resulting in $150 billion in net earnings at a 15% profit margin, nearly double current levels, showcasing strong long-term investment value.
See More
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- Uncertain Cash Flow Outlook: Amazon's free cash flow is expected to approach zero or turn negative by 2026, while Alphabet may maintain positive cash flow, despite tapping the debt market for $32 billion to fund its data center expansion.
- Growing Backlogs: Alphabet's backlog reached $240 billion, up 55% sequentially, while Amazon's backlog grew to $244 billion, a 22% increase, indicating strong market demand for AI products for both companies.
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See More
