Amazon Poised to Join $3 Trillion Club
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy AMZN?
Source: NASDAQ.COM
- E-commerce Growth: Amazon's Q4 e-commerce net sales reached $213.4 billion, a 14% year-over-year increase, with 57% coming from digital retail and third-party seller services, driving net income up 18% to $24.9 billion, showcasing its robust performance in the global retail market.
- Cloud Market Leadership: Amazon Web Services (AWS) commands a 28% market share, with Q4 2025 revenue growing 30% year-over-year, contributing 18% to total revenue and 57% to operating income, thereby supporting ongoing investments in AI.
- Advertising Business Expansion: Amazon's advertising revenue grew 23% in Q4 to $21.3 billion, representing 10% of total revenue, making it the world's third-largest digital advertiser, further diversifying the company's revenue streams.
- Capital Expenditure Plans: Amazon plans to increase capital expenditures to $200 billion in 2026, up from $131 billion in 2025, which, despite causing short-term stock fluctuations, will ultimately meet the strong demand for cloud and AI services.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy AMZN?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
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: 210.110
Low
175.00
Averages
280.01
High
325.00
Current: 210.110
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's Strong Q4 Performance Suggests Buying Opportunity Amid Market Sell-Off
- Significant Revenue Growth: Amazon's Q4 net sales rose 14% year-over-year to $213.4 billion, or 12% excluding foreign exchange, demonstrating strong growth momentum in both e-commerce and cloud computing despite prevailing market pessimism.
- Accelerating Cloud Business: Amazon Web Services (AWS) reported a 24% increase in Q4 sales to $35.6 billion, up from a 20% growth rate in the previous quarter, indicating that its cloud computing segment is gaining traction and enhancing future profitability prospects.
- Operating Income Increase: The company achieved an operating income of $25 billion in Q4, up from $21.2 billion a year earlier, and would have reached $27.4 billion without special charges, reflecting robust performance across its business segments.
- Declining Free Cash Flow: While operating cash flow increased by 20% to $139.5 billion, free cash flow fell sharply from $38.2 billion to $11.2 billion, primarily due to rising capital expenditures, which may indicate Amazon's aggressive investment in significant growth opportunities like AI.
See More
Amazon to Invest $12B in Louisiana Data Centers to Boost AI Operations
- Massive Investment: Amazon has announced a $12 billion investment to build data centers in Louisiana, aimed at bolstering its cloud computing and AI operations, reflecting the company's strong response to the surging demand for AI.
- Intensifying Industry Competition: Hyperscalers in the U.S. are fiercely competing for market dominance, with Amazon planning to spend up to $200 billion in 2023, primarily in its AWS unit, to meet the soaring demand for AI workloads.
- Local Economic Impact: This investment is expected to create approximately 540 on-site new jobs and support an additional 1,700 jobs in the community, further driving economic development in Louisiana.
- Infrastructure Advantages: Louisiana has emerged as a hotspot for AI infrastructure projects due to significant tax benefits, low electricity rates, and a reliable power grid, with data center investments accounting for over a third of the $61 billion in capital investments secured by the state in 2025.
See More
Software Stocks Plunge as AI Concerns Rise
- Market Decline: The S&P North American Technology Software Index has plunged 32% from its September peak, entering bear market territory primarily due to investor fears that artificial intelligence will undermine demand and profit margins in the software industry, leading to indiscriminate selling.
- Microsoft's Strong Performance: Microsoft reported a 17% revenue increase to $81 billion in the December quarter, with non-GAAP net income rising 24% to $4.14 per share; however, shares fell sharply due to Azure revenue narrowly missing estimates, raising investor concerns about AI spending.
- Cloudflare's Robust Growth: Cloudflare's fourth-quarter revenue surged 33% to $614 million, with a 39% increase in paying customers and a net revenue retention rate of 120%, showcasing the company's competitive edge in the AI agent proliferation, even as its stock trades 31% below its peak.
- Emerging Investment Opportunities: Analysts widely view Microsoft and Cloudflare as undervalued, with a median target price of $600 for Microsoft implying a 52% upside, while Cloudflare's target price of $245 suggests a 40% upside, presenting attractive opportunities for patient investors.
See More
Amazon Poised to Join $3 Trillion Club
- E-commerce Growth: Amazon's Q4 e-commerce net sales reached $213.4 billion, a 14% year-over-year increase, with 57% coming from digital retail and third-party seller services, driving net income up 18% to $24.9 billion, showcasing its robust performance in the global retail market.
- Cloud Market Leadership: Amazon Web Services (AWS) commands a 28% market share, with Q4 2025 revenue growing 30% year-over-year, contributing 18% to total revenue and 57% to operating income, thereby supporting ongoing investments in AI.
- Advertising Business Expansion: Amazon's advertising revenue grew 23% in Q4 to $21.3 billion, representing 10% of total revenue, making it the world's third-largest digital advertiser, further diversifying the company's revenue streams.
- Capital Expenditure Plans: Amazon plans to increase capital expenditures to $200 billion in 2026, up from $131 billion in 2025, which, despite causing short-term stock fluctuations, will ultimately meet the strong demand for cloud and AI services.
See More
Amazon Invests $12 Billion in Louisiana for Data Centers
- Investment Scale: Amazon announced a $12 billion investment in Louisiana for data center development, projected to create 540 full-time positions and support an additional 1,710 full-time equivalent roles, significantly boosting local economic growth.
- Regional Economic Stimulation: The investment will be spread across Caddo and Bossier Parishes, aimed at stimulating regional economic activity and providing job opportunities for electricians, HVAC technicians, project engineers, and more, catering to the demand for cloud computing technologies.
- Renewable Energy Contribution: In 2024, Amazon invested in solar projects in Louisiana, adding 200 megawatts of carbon-free power to the grid, supporting long-term electricity affordability, and further solidifying its operational footprint in the state.
- Infrastructure Expansion: This investment marks another significant step in Amazon's expansion of data center infrastructure, indicating its proactive approach to meet the soaring AI demand globally and enhancing its competitive position in the market.
See More
Amazon Approaches $3 Trillion Market Cap
- E-commerce Growth: Amazon's Q4 net sales reached $213.4 billion, marking a 14% year-over-year increase, with 57% derived from digital retail and third-party seller services, driving an 18% rise in net income to $24.9 billion, showcasing its robust performance and sustained market leadership in retail.
- Cloud Market Leadership: Amazon Web Services (AWS) commands 28% of the market, with a remarkable 30% year-over-year growth, contributing 18% of the company's revenue and 57% of operating income, indicating its ongoing dominance and profitability in cloud computing and AI.
- Advertising Business Expansion: Amazon's advertising revenue grew 23% year-over-year to $21.3 billion in Q4, representing 10% of total revenue, positioning it as the world's third-largest digital advertiser, thereby enhancing the company's diversified revenue streams and competitive edge.
- Capital Expenditure Plans: Amazon plans to increase capital expenditures to $200 billion in 2026, up from $131 billion in 2025, which, despite causing short-term stock fluctuations, reflects the company's strong confidence in the demand for cloud and AI services, potentially accelerating its journey towards a $3 trillion market cap.
See More
Amazon's Strong Q4 Performance Suggests Buying Opportunity Amid Market Sell-Off
- Significant Revenue Growth: Amazon's Q4 net sales rose 14% year-over-year to $213.4 billion, or 12% excluding foreign exchange, demonstrating strong growth momentum in both e-commerce and cloud computing despite prevailing market pessimism.
- Accelerating Cloud Business: Amazon Web Services (AWS) reported a 24% increase in Q4 sales to $35.6 billion, up from a 20% growth rate in the previous quarter, indicating that its cloud computing segment is gaining traction and enhancing future profitability prospects.
- Operating Income Increase: The company achieved an operating income of $25 billion in Q4, up from $21.2 billion a year earlier, and would have reached $27.4 billion without special charges, reflecting robust performance across its business segments.
- Declining Free Cash Flow: While operating cash flow increased by 20% to $139.5 billion, free cash flow fell sharply from $38.2 billion to $11.2 billion, primarily due to rising capital expenditures, which may indicate Amazon's aggressive investment in significant growth opportunities like AI.
See More
Amazon to Invest $12B in Louisiana Data Centers to Boost AI Operations
- Massive Investment: Amazon has announced a $12 billion investment to build data centers in Louisiana, aimed at bolstering its cloud computing and AI operations, reflecting the company's strong response to the surging demand for AI.
- Intensifying Industry Competition: Hyperscalers in the U.S. are fiercely competing for market dominance, with Amazon planning to spend up to $200 billion in 2023, primarily in its AWS unit, to meet the soaring demand for AI workloads.
- Local Economic Impact: This investment is expected to create approximately 540 on-site new jobs and support an additional 1,700 jobs in the community, further driving economic development in Louisiana.
- Infrastructure Advantages: Louisiana has emerged as a hotspot for AI infrastructure projects due to significant tax benefits, low electricity rates, and a reliable power grid, with data center investments accounting for over a third of the $61 billion in capital investments secured by the state in 2025.
See More
Software Stocks Plunge as AI Concerns Rise
- Market Decline: The S&P North American Technology Software Index has plunged 32% from its September peak, entering bear market territory primarily due to investor fears that artificial intelligence will undermine demand and profit margins in the software industry, leading to indiscriminate selling.
- Microsoft's Strong Performance: Microsoft reported a 17% revenue increase to $81 billion in the December quarter, with non-GAAP net income rising 24% to $4.14 per share; however, shares fell sharply due to Azure revenue narrowly missing estimates, raising investor concerns about AI spending.
- Cloudflare's Robust Growth: Cloudflare's fourth-quarter revenue surged 33% to $614 million, with a 39% increase in paying customers and a net revenue retention rate of 120%, showcasing the company's competitive edge in the AI agent proliferation, even as its stock trades 31% below its peak.
- Emerging Investment Opportunities: Analysts widely view Microsoft and Cloudflare as undervalued, with a median target price of $600 for Microsoft implying a 52% upside, while Cloudflare's target price of $245 suggests a 40% upside, presenting attractive opportunities for patient investors.
See More
Amazon Poised to Join $3 Trillion Club
- E-commerce Growth: Amazon's Q4 e-commerce net sales reached $213.4 billion, a 14% year-over-year increase, with 57% coming from digital retail and third-party seller services, driving net income up 18% to $24.9 billion, showcasing its robust performance in the global retail market.
- Cloud Market Leadership: Amazon Web Services (AWS) commands a 28% market share, with Q4 2025 revenue growing 30% year-over-year, contributing 18% to total revenue and 57% to operating income, thereby supporting ongoing investments in AI.
- Advertising Business Expansion: Amazon's advertising revenue grew 23% in Q4 to $21.3 billion, representing 10% of total revenue, making it the world's third-largest digital advertiser, further diversifying the company's revenue streams.
- Capital Expenditure Plans: Amazon plans to increase capital expenditures to $200 billion in 2026, up from $131 billion in 2025, which, despite causing short-term stock fluctuations, will ultimately meet the strong demand for cloud and AI services.
See More
Amazon Invests $12 Billion in Louisiana for Data Centers
- Investment Scale: Amazon announced a $12 billion investment in Louisiana for data center development, projected to create 540 full-time positions and support an additional 1,710 full-time equivalent roles, significantly boosting local economic growth.
- Regional Economic Stimulation: The investment will be spread across Caddo and Bossier Parishes, aimed at stimulating regional economic activity and providing job opportunities for electricians, HVAC technicians, project engineers, and more, catering to the demand for cloud computing technologies.
- Renewable Energy Contribution: In 2024, Amazon invested in solar projects in Louisiana, adding 200 megawatts of carbon-free power to the grid, supporting long-term electricity affordability, and further solidifying its operational footprint in the state.
- Infrastructure Expansion: This investment marks another significant step in Amazon's expansion of data center infrastructure, indicating its proactive approach to meet the soaring AI demand globally and enhancing its competitive position in the market.
See More
Amazon Approaches $3 Trillion Market Cap
- E-commerce Growth: Amazon's Q4 net sales reached $213.4 billion, marking a 14% year-over-year increase, with 57% derived from digital retail and third-party seller services, driving an 18% rise in net income to $24.9 billion, showcasing its robust performance and sustained market leadership in retail.
- Cloud Market Leadership: Amazon Web Services (AWS) commands 28% of the market, with a remarkable 30% year-over-year growth, contributing 18% of the company's revenue and 57% of operating income, indicating its ongoing dominance and profitability in cloud computing and AI.
- Advertising Business Expansion: Amazon's advertising revenue grew 23% year-over-year to $21.3 billion in Q4, representing 10% of total revenue, positioning it as the world's third-largest digital advertiser, thereby enhancing the company's diversified revenue streams and competitive edge.
- Capital Expenditure Plans: Amazon plans to increase capital expenditures to $200 billion in 2026, up from $131 billion in 2025, which, despite causing short-term stock fluctuations, reflects the company's strong confidence in the demand for cloud and AI services, potentially accelerating its journey towards a $3 trillion market cap.
See More
