Amazon's Custom Chips Present a New Challenge for Nvidia
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 02 2025
0mins
Source: WSJ
Amazon's New AI Chip: Amazon Web Services has launched its Trainium3 custom AI chip, which is claimed to be four times faster than its previous AI chips.
Cost Efficiency: The Trainium3 chip can potentially reduce the costs of training and operating AI models by up to 50% compared to systems using equivalent GPUs.
Discover Tomorrow's Bullish Stocks Today
Receive free daily stock recommendations and professional analysis to optimize your portfolio's potential.
Sign up now to unlock expert insights and stay one step ahead of the market trends.
Analyst Views on META
Wall Street analysts forecast META stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for META is 824.71 USD with a low forecast of 655.15 USD and a high forecast of 1117 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.
44 Analyst Rating
37 Buy
6 Hold
1 Sell
Strong Buy
Current: 668.730
Low
655.15
Averages
824.71
High
1117
Current: 668.730
Low
655.15
Averages
824.71
High
1117
About META
Meta Platforms, Inc. is building human connections, powered by artificial intelligence and immersive technologies. The Company's products enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality (VR) and mixed reality (MR) headsets, augmented reality (AR), and wearables. It also helps people discover and learn about what is going on in the world around them, enabling people to share their experiences, ideas, photos, videos, and other content with audiences ranging from their closest family members and friends to the public at large. The Company's segments include Family of Apps (FoA) and Reality Labs (RL). FoA segment includes Facebook, Instagram, Messenger, WhatsApp and Threads. RL segment includes its virtual, augmented, and mixed reality related consumer hardware, software and content. Its product offerings in VR include its Meta Quest devices, as well as software and content available through the Meta Horizon Store.
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.
Meta's Earnings Beat Expectations, Analysts Raise Price Targets
- Strong Earnings: Meta reported fourth-quarter earnings of $8.88 per share and revenue of $59.89 billion, both exceeding market expectations, indicating that AI-driven advertising monetization is alleviating concerns over rising operating and capital expenditures.
- Robust Guidance: The company expects first-quarter sales to range between $53.5 billion and $56.5 billion, significantly above the consensus estimate of $51.41 billion, suggesting strong growth momentum in its advertising business that reinforces its market position.
- AI Investment Returns: Despite a $6.02 billion operating loss from Reality Labs, analysts remain optimistic about Meta's AI investments, believing that the growth in its advertising business will offset these losses, with benefits from AI expected to materialize by 2026.
- Analyst Optimism: Several Wall Street analysts raised their price targets for Meta, with Barclays increasing its target to $800, implying a 20% upside, reflecting confidence in Meta's long-term growth potential.
Continue Reading
Meta's AI Investments Approved by Investors, Shares Surge 8%
- Meta's Stock Surge: Following a strong earnings report, Meta's shares jumped 8%, indicating investor approval of its AI spending plan of $115 billion to $135 billion, which is expected to drive future revenue growth.
- Strong Revenue Growth: Meta's reported 24% year-over-year revenue growth, primarily driven by online advertising, alleviated investor concerns about its high spending, demonstrating that its AI investment strategy is yielding results.
- Microsoft's Challenges: In stark contrast, Microsoft's stock plummeted 11% as its Azure cloud segment's growth slowed to 39%, coupled with a 66% surge in capital expenditures to $37.5 billion, exceeding analyst expectations and highlighting spending pressures in the AI sector.
- Capacity Constraints: Microsoft's CFO noted that Azure could have grown 40% if all new GPU chips had been allocated to its Azure business, reflecting a tight supply-demand situation that negatively impacted the company's overall performance.
Continue Reading