Amazon Projects $125 Billion CapEx to Boost Cloud Growth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2h ago
0mins
Source: Fool
- Cloud Growth Engine: Amazon's cloud platform, AWS, continues to be a critical growth driver, with management projecting capital expenditures of $125 billion this year to rapidly expand data center capacity, thereby meeting robust customer demand for AI tools.
- Online Shopping Trend: Amazon leverages its vast product selection and finely-tuned logistics network to drive sustained growth in online shopping, not only enhancing user experience but also boosting Prime membership sign-ups and renewals, which further expands the Amazon ecosystem.
- Digital Advertising Market Rise: Amazon has collected $65 billion in digital ad revenues over the past 12 months, rapidly ascending as a significant player in the market, demonstrating its ability to provide substantial value to marketers in the expanding digital ad landscape.
- Market Cap Growth Potential: With a current market cap of approximately $2.4 trillion, Amazon needs to grow by 25% to reach the $3 trillion milestone, a target that historical performance suggests is achievable within the next 12 months, as analysts forecast a 26% increase in operating income between 2025 and 2026.
AMZN
$228.43+Infinity%1D
Analyst Views on AMZN
Wall Street analysts forecast AMZN stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for AMZN is 294.71 USD with a low forecast of 250.00 USD and a high forecast of 340.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
43 Analyst Rating
40 Buy
3 Hold
0 Sell
Strong Buy
Current: 227.350
Low
250.00
Averages
294.71
High
340.00
Current: 227.350
Low
250.00
Averages
294.71
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.
