Amazon Partners with Meta for AI Chip Deal
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy AMZN?
Source: NASDAQ.COM
- Stock Surge: Amazon's shares have surged over 25% in the last 30 days, reflecting investor optimism about the company's growth prospects, particularly as its custom silicon strategy shows success.
- Meta Partnership: Meta will utilize AWS's Graviton5 CPU chips for AI workloads, with plans to deploy 'tens of millions of cores,' marking a significant expansion of their long-standing partnership and potentially increasing Amazon's market share in AI.
- Anthropic Commitment: Anthropic has committed over $100 billion to AWS technologies over the next decade, securing up to 5 gigawatts of new capacity to train its AI model Claude, further solidifying Amazon's position in the AI market.
- Revenue Growth Outlook: Amazon's AI revenue run rate is projected to exceed $15 billion by 2026, with its chip business running at over $20 billion annually and growing at triple-digit rates, indicating strong market demand and competitive strength in the AI sector.
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Analyst Views on AMZN
Wall Street analysts forecast AMZN stock price to rise
44 Analyst Rating
41 Buy
3 Hold
0 Sell
Strong Buy
Current: 255.080
Low
175.00
Averages
280.01
High
325.00
Current: 255.080
Low
175.00
Averages
280.01
High
325.00
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.
Amazon Stock Surges as AWS Growth Accelerates
- Stock Recovery: Amazon's stock has surged approximately 14% year-to-date, with a nearly 25% increase over the last 30 days, indicating strong market optimism ahead of its upcoming first-quarter earnings report.
- AWS Growth Acceleration: In the fourth quarter, Amazon's net sales rose 14% year-over-year to $213.4 billion, with AWS sales increasing 24% to $35.6 billion, underscoring its critical role as a high-margin profit engine that enhances overall profitability.
- Massive Capital Expenditure Plan: Amazon anticipates capital expenditures to reach about $200 billion by 2026, primarily driven by demand in AI, robotics, and low-earth orbit satellites, reflecting a strong response to future demand despite potential short-term cash flow pressures.
- Cautious Profit Outlook: While the first-quarter sales guidance ranges from $173.5 billion to $178.5 billion, implying about 13% growth, the expected operating income growth of only 3.3% indicates challenges to profitability due to increased investments.
See More
Amazon Commits $25 Billion Investment to Anthropic
- Massive Investment: Amazon has announced a commitment of up to $25 billion to AI startup Anthropic, which includes an initial investment of $5 billion and up to $20 billion tied to commercial milestones, significantly deepening their partnership and potentially enhancing Amazon's AI capabilities.
- Cloud Spending Commitment: In return, Anthropic has pledged to spend over $100 billion on Amazon Web Services (AWS) over the next decade, securing up to 5 gigawatts of compute capacity for training and running its Claude models, thereby strengthening Amazon's position in the cloud computing market.
- Strong Cash Flow: AWS revenue surged 24% year-over-year to $35.6 billion in Q4 2025, making it the primary driver of Amazon's operating income, and the partnership with Anthropic is expected to further boost this growth, enhancing overall profitability.
- Capital Expenditure Pressure: While Amazon plans to spend about $200 billion this year on infrastructure, primarily in AI, Anthropic's long-term commitment helps mitigate the risks associated with such capital outlays, alleviating investor concerns about short-term cash flow pressures.
See More
Market Expectations for Major Tech Earnings on April 29
- Earnings Report Expectations: Meta Platforms, Google, Amazon, and Microsoft are set to report earnings on April 29, with the market closely monitoring their performance, which is expected to significantly impact stock prices.
- Market Reaction: As of April 21, 2026, Meta's stock price rose by 2.48%, indicating investor optimism regarding the upcoming earnings report, which may reflect confidence in the company's future growth prospects.
- Industry Trends: With the ongoing growth in the tech sector, analysts anticipate that these earnings reports will reveal the overall health of the industry, particularly in the context of economic recovery, where changes in consumer spending and advertising revenue will be key indicators.
- Investor Focus: Investors should pay attention to the guidance provided by these companies regarding future outlooks, especially concerning revenue growth and cost control strategies, as these will directly influence market evaluations of their stocks.
See More
eBay Stock Investment Outlook Analysis
- Strong Market Performance: As of April 20, eBay's stock was trading at $107.13 with a P/E ratio of 24.57, indicating a robust market position in the global resale economy, processing over $80 billion in annual gross merchandise volume despite being perceived as an aging e-commerce platform.
- Significant Financial Growth: Q4/FY25 results showed an 8% YoY increase in GMV to $21.2 billion, a 13% rise in revenue to $2.96 billion, and a 13% increase in EPS to $1.41, driven by advertising growth and high-margin services, reflecting strong performance in the U.S. market.
- Strategic Acquisition Enhances Market Position: eBay's $1.2 billion acquisition of Depop strengthens its foothold with Gen Z buyers and the fast-growing circular fashion market, while integrating Depop into its infrastructure is expected to provide monetization and operational leverage, although near-term margin dilution is anticipated.
- Optimistic Future Growth Outlook: Guidance for 2026 indicates continued GMV growth of 9-10% and EPS growth of roughly 10%, with medium-term prospects for mid-single-digit GMV growth and margin expansion, suggesting that the company remains attractive in a competitive market.
See More
Tech Giants' Earnings and Spending Will Be Key
- Market Highs Challenge: While the stock market is at highs, the earnings and spending results of tech giants like Apple, Amazon, and Google will be key focal points, potentially impacting investor confidence and market trends.
- Iran Talks Halted: The cancellation of talks with Iran may have implications for global markets, particularly in the energy and tech sectors, prompting investors to closely monitor further developments.
- Earnings Pressure: As earnings season approaches, expectations for tech companies' profitability are under pressure, with analysts keenly observing their spending strategies to assess future growth potential.
- Investor Sentiment Fluctuation: Market sentiment may fluctuate based on the earnings results of tech giants, especially in the current economic environment, where investors are filled with both anticipation and concern regarding these companies' performances.
See More
Amazon Partners with Meta for AI Chip Deal
- Stock Surge: Amazon's shares have risen over 25% in the last 30 days, primarily driven by a new partnership with Meta, which will utilize AWS's Graviton5 CPU chips for AI workloads, thereby boosting investor confidence in Amazon's custom silicon strategy.
- Significance of Meta Deal: The multi-year agreement with Meta involves the use of 'tens of millions of cores' of Graviton chips, marking a significant expansion of the long-standing partnership and indicating that Amazon's strategic positioning in AI is gaining market validation.
- Investment Commitment from Anthropic: The expanded partnership with Anthropic is equally crucial, as they commit over $100 billion to AWS technologies over the next decade, securing up to 5 gigawatts of new capacity for training its AI model Claude, highlighting strong demand for Amazon's AI offerings.
- Robust Growth in Chip Business: Amazon's AI revenue run rate exceeded $15 billion in Q1 2026, while its chip business has an annual run rate of over $20 billion, growing at triple-digit rates, indicating a strong market demand for its high-performance, cost-effective products.
See More
Amazon Stock Surges as AWS Growth Accelerates
- Stock Recovery: Amazon's stock has surged approximately 14% year-to-date, with a nearly 25% increase over the last 30 days, indicating strong market optimism ahead of its upcoming first-quarter earnings report.
- AWS Growth Acceleration: In the fourth quarter, Amazon's net sales rose 14% year-over-year to $213.4 billion, with AWS sales increasing 24% to $35.6 billion, underscoring its critical role as a high-margin profit engine that enhances overall profitability.
- Massive Capital Expenditure Plan: Amazon anticipates capital expenditures to reach about $200 billion by 2026, primarily driven by demand in AI, robotics, and low-earth orbit satellites, reflecting a strong response to future demand despite potential short-term cash flow pressures.
- Cautious Profit Outlook: While the first-quarter sales guidance ranges from $173.5 billion to $178.5 billion, implying about 13% growth, the expected operating income growth of only 3.3% indicates challenges to profitability due to increased investments.
See More
Amazon Commits $25 Billion Investment to Anthropic
- Massive Investment: Amazon has announced a commitment of up to $25 billion to AI startup Anthropic, which includes an initial investment of $5 billion and up to $20 billion tied to commercial milestones, significantly deepening their partnership and potentially enhancing Amazon's AI capabilities.
- Cloud Spending Commitment: In return, Anthropic has pledged to spend over $100 billion on Amazon Web Services (AWS) over the next decade, securing up to 5 gigawatts of compute capacity for training and running its Claude models, thereby strengthening Amazon's position in the cloud computing market.
- Strong Cash Flow: AWS revenue surged 24% year-over-year to $35.6 billion in Q4 2025, making it the primary driver of Amazon's operating income, and the partnership with Anthropic is expected to further boost this growth, enhancing overall profitability.
- Capital Expenditure Pressure: While Amazon plans to spend about $200 billion this year on infrastructure, primarily in AI, Anthropic's long-term commitment helps mitigate the risks associated with such capital outlays, alleviating investor concerns about short-term cash flow pressures.
See More
Market Expectations for Major Tech Earnings on April 29
- Earnings Report Expectations: Meta Platforms, Google, Amazon, and Microsoft are set to report earnings on April 29, with the market closely monitoring their performance, which is expected to significantly impact stock prices.
- Market Reaction: As of April 21, 2026, Meta's stock price rose by 2.48%, indicating investor optimism regarding the upcoming earnings report, which may reflect confidence in the company's future growth prospects.
- Industry Trends: With the ongoing growth in the tech sector, analysts anticipate that these earnings reports will reveal the overall health of the industry, particularly in the context of economic recovery, where changes in consumer spending and advertising revenue will be key indicators.
- Investor Focus: Investors should pay attention to the guidance provided by these companies regarding future outlooks, especially concerning revenue growth and cost control strategies, as these will directly influence market evaluations of their stocks.
See More
eBay Stock Investment Outlook Analysis
- Strong Market Performance: As of April 20, eBay's stock was trading at $107.13 with a P/E ratio of 24.57, indicating a robust market position in the global resale economy, processing over $80 billion in annual gross merchandise volume despite being perceived as an aging e-commerce platform.
- Significant Financial Growth: Q4/FY25 results showed an 8% YoY increase in GMV to $21.2 billion, a 13% rise in revenue to $2.96 billion, and a 13% increase in EPS to $1.41, driven by advertising growth and high-margin services, reflecting strong performance in the U.S. market.
- Strategic Acquisition Enhances Market Position: eBay's $1.2 billion acquisition of Depop strengthens its foothold with Gen Z buyers and the fast-growing circular fashion market, while integrating Depop into its infrastructure is expected to provide monetization and operational leverage, although near-term margin dilution is anticipated.
- Optimistic Future Growth Outlook: Guidance for 2026 indicates continued GMV growth of 9-10% and EPS growth of roughly 10%, with medium-term prospects for mid-single-digit GMV growth and margin expansion, suggesting that the company remains attractive in a competitive market.
See More
Tech Giants' Earnings and Spending Will Be Key
- Market Highs Challenge: While the stock market is at highs, the earnings and spending results of tech giants like Apple, Amazon, and Google will be key focal points, potentially impacting investor confidence and market trends.
- Iran Talks Halted: The cancellation of talks with Iran may have implications for global markets, particularly in the energy and tech sectors, prompting investors to closely monitor further developments.
- Earnings Pressure: As earnings season approaches, expectations for tech companies' profitability are under pressure, with analysts keenly observing their spending strategies to assess future growth potential.
- Investor Sentiment Fluctuation: Market sentiment may fluctuate based on the earnings results of tech giants, especially in the current economic environment, where investors are filled with both anticipation and concern regarding these companies' performances.
See More
Amazon Partners with Meta for AI Chip Deal
- Stock Surge: Amazon's shares have risen over 25% in the last 30 days, primarily driven by a new partnership with Meta, which will utilize AWS's Graviton5 CPU chips for AI workloads, thereby boosting investor confidence in Amazon's custom silicon strategy.
- Significance of Meta Deal: The multi-year agreement with Meta involves the use of 'tens of millions of cores' of Graviton chips, marking a significant expansion of the long-standing partnership and indicating that Amazon's strategic positioning in AI is gaining market validation.
- Investment Commitment from Anthropic: The expanded partnership with Anthropic is equally crucial, as they commit over $100 billion to AWS technologies over the next decade, securing up to 5 gigawatts of new capacity for training its AI model Claude, highlighting strong demand for Amazon's AI offerings.
- Robust Growth in Chip Business: Amazon's AI revenue run rate exceeded $15 billion in Q1 2026, while its chip business has an annual run rate of over $20 billion, growing at triple-digit rates, indicating a strong market demand for its high-performance, cost-effective products.
See More
