Comparative Analysis of Amazon and Costco Stocks
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 26 2026
0mins
Should l Buy AMZN?
Source: Fool
- Amazon Sales Growth: Amazon reported net sales of $213.4 billion in Q4 2025, reflecting a robust 14% year-over-year increase, indicating strong market competitiveness despite a stock price decline in 2026.
- Capital Expenditure Plans: Amazon plans to invest a staggering $200 billion in capital expenditures this year, primarily for AI infrastructure, a strategic move that is expected to drive future revenue growth, although it may raise short-term investor concerns.
- Costco's Steady Performance: Costco's net sales increased by 9.1% year-over-year to $68.2 billion in Q2 of fiscal 2026, with net income rising 13.8% to $2.04 billion, showcasing its resilience amid economic uncertainties.
- Pricing Strategy Advantage: Costco's CEO emphasized the company's commitment to competitive pricing, maintaining a high membership renewal rate of 92.1% in the U.S. and Canada despite tariff pressures, which provides stability in the current market environment.
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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: 210.570
Low
175.00
Averages
280.01
High
325.00
Current: 210.570
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 Web Services Sees Significant Revenue Growth
- Accelerated Revenue Growth: Amazon Web Services (AWS) saw a 24% year-over-year revenue surge in Q4 2025, reaching $35.6 billion, significantly up from 20% growth in Q3, indicating strong enterprise demand for generative AI applications driving data infrastructure modernization.
- Substantial Capital Expenditure Increase: Management expects capital expenditures to reach $200 billion in 2026, sharply up from $131 billion in 2025, reflecting Amazon's ambitious goals in AI and a significant financial commitment to infrastructure development.
- Diversified Revenue Support: Although Amazon's trailing-12-month free cash flow fell to $11.2 billion, its operating cash flow increased by 20% year-over-year to $139.5 billion, demonstrating strong performance in high-margin segments like advertising and subscriptions, enabling self-funding for AI infrastructure investments.
- Market Risks and Opportunities: Despite risks of waning market appetite for AI software, Amazon's diversified business model and robust operating cash flow present an attractive long-term investment opportunity, allowing investors to capitalize on the current stock price pullback for future growth.
See More
Tesla and Amazon's Strategic Moves in AI Robotics Market
- Tesla's Strategic Shift: Tesla has announced the discontinuation of its Model S and Model X, focusing instead on the production of Model 3 and Model Y, while repurposing factory space for its Optimus humanoid robots, expected to launch by the end of 2027, which could significantly enhance the company's revenue and profitability if successful.
- AI Robotics Market Potential: Projections indicate that the AI robotics market will reach approximately $375.8 billion by 2035, with a compound annual growth rate of 17.33%, and if Tesla and Amazon can capitalize on this opportunity, they could achieve substantial returns and transform their market positions.
- Amazon's Robotics Innovation: Amazon has ramped up its investments in the robotics market over the past few years, launching a million AI-powered robots last year and acquiring Fauna Robotics; although it lags behind Tesla in robotics, its strong cash reserves (totaling $123 billion as of Q4) provide a solid foundation for catching up.
- Market Competition and Risks: While the outlook for Tesla and Amazon in the AI robotics sector is optimistic, they face risks including legal and regulatory challenges, and the uncertainty of whether Tesla's robots will meet expectations, which will directly impact their stock prices and market performance.
See More
Marvell Technology Shares Surge 21.3% Amid Strong Earnings and Nvidia Investment
- Earnings Beat: Marvell Technology reported a 22.1% year-over-year revenue increase to $2.2 billion in its fourth quarter, with adjusted earnings per share rising 33.3% to $0.80, surpassing analyst expectations and showcasing robust financial performance.
- Optimistic Guidance: Management anticipates a 9% sequential revenue increase in the first quarter, projecting adjusted EPS of $0.79, indicating sustained growth potential in AI infrastructure, particularly within the data center segment.
- Collaboration with Nvidia: Nvidia's announcement of a $2 billion investment in Marvell, coupled with a product partnership, is expected to enhance Marvell's market position in AI infrastructure, particularly in the application of photonic networking technologies.
- Diversified Customer Base: Marvell has added Microsoft as a client, with Microsoft's Maia2 chip likely to drive further business growth in AI chips, demonstrating the company's adaptability and strategic positioning in a competitive market.
See More
Tesla and Amazon's Strategic Moves in Robotics Market
- Tesla's Robotics Initiative: Tesla has announced the discontinuation of its Model S and Model X, reallocating factory space to produce Optimus humanoid robots, which are set to launch by the end of 2027; if successful, this could generate high-margin recurring revenue and alleviate the impact of declining EV sales.
- Massive Market Potential: The AI robotics market is projected to reach $375.8 billion by 2035, with a compound annual growth rate of 17.33%, presenting significant growth opportunities for companies like Tesla and Amazon, thereby attracting investor interest.
- Amazon's Acquisition Moves: Amazon recently acquired Fauna Robotics, focusing on developing friendly humanoid robots for home and business use; although it lags behind Tesla in the robotics sector, its substantial cash reserves and innovation focus could enable it to catch up quickly.
- Warehouse Optimization Progress: Over the past year, Amazon has launched over a million AI-powered robots to optimize warehouse operations, and while the short-term financial impact may be limited, significant revenue could be realized if the market grows as projected.
See More
Marvell Technology Reports Strong Quarter with Nvidia Investment
- Strong Performance: Marvell reported a 22.1% revenue increase in Q4 to $2.2 billion, with adjusted EPS rising 33.3% to $0.80, surpassing analyst expectations and demonstrating the company's robust position in AI infrastructure.
- Optimistic Outlook: Management anticipates a 9% sequential revenue growth in Q1, guiding for adjusted EPS of $0.79, reflecting confidence in its data center business, particularly with a projected 40% growth in data center revenue for fiscal 2027.
- Strategic Investment: Nvidia's announcement of a $2 billion investment in Marvell, coupled with a product partnership, aims to integrate their technologies to advance the development of next-generation optical networking products for AI data centers, reinforcing Marvell's leadership in networking technology.
- Diversified Customer Base: The addition of Microsoft as a client, with its Maia2 chip leveraging Marvell's technology, indicates enhanced competitiveness in the AI chip market and alleviates concerns regarding potential market share loss with Amazon.
See More
Pershing Square Increases Holdings in Three Major Tech Stocks
- Portfolio Concentration: As of December 31, 2025, Pershing Square's investments in Amazon, Alphabet, and Meta Platforms totaled $5.9 billion, representing nearly 40% of its portfolio, reflecting strong confidence in these high-quality companies.
- Valuation Timing: Ackman entered these three companies at P/E ratios of 16, 25, and 20 during periods of weak market sentiment, indicating a strategy focused on finding value amidst uncertainty, potentially laying the groundwork for future earnings growth.
- Capital Expenditure Plans: In 2026, Alphabet plans to invest $175 billion to $185 billion, while Amazon and Meta are set to spend $200 billion and $115 billion to $135 billion on AI-related investments, demonstrating their commitment to technological innovation.
- Cash Reserve Advantage: As of December 31, 2025, these three companies collectively held $331 billion in cash and cash equivalents, significantly exceeding their long-term debt, indicating strong financial capacity for future investments and market volatility management.
See More
Amazon Web Services Sees Significant Revenue Growth
- Accelerated Revenue Growth: Amazon Web Services (AWS) saw a 24% year-over-year revenue surge in Q4 2025, reaching $35.6 billion, significantly up from 20% growth in Q3, indicating strong enterprise demand for generative AI applications driving data infrastructure modernization.
- Substantial Capital Expenditure Increase: Management expects capital expenditures to reach $200 billion in 2026, sharply up from $131 billion in 2025, reflecting Amazon's ambitious goals in AI and a significant financial commitment to infrastructure development.
- Diversified Revenue Support: Although Amazon's trailing-12-month free cash flow fell to $11.2 billion, its operating cash flow increased by 20% year-over-year to $139.5 billion, demonstrating strong performance in high-margin segments like advertising and subscriptions, enabling self-funding for AI infrastructure investments.
- Market Risks and Opportunities: Despite risks of waning market appetite for AI software, Amazon's diversified business model and robust operating cash flow present an attractive long-term investment opportunity, allowing investors to capitalize on the current stock price pullback for future growth.
See More
Tesla and Amazon's Strategic Moves in AI Robotics Market
- Tesla's Strategic Shift: Tesla has announced the discontinuation of its Model S and Model X, focusing instead on the production of Model 3 and Model Y, while repurposing factory space for its Optimus humanoid robots, expected to launch by the end of 2027, which could significantly enhance the company's revenue and profitability if successful.
- AI Robotics Market Potential: Projections indicate that the AI robotics market will reach approximately $375.8 billion by 2035, with a compound annual growth rate of 17.33%, and if Tesla and Amazon can capitalize on this opportunity, they could achieve substantial returns and transform their market positions.
- Amazon's Robotics Innovation: Amazon has ramped up its investments in the robotics market over the past few years, launching a million AI-powered robots last year and acquiring Fauna Robotics; although it lags behind Tesla in robotics, its strong cash reserves (totaling $123 billion as of Q4) provide a solid foundation for catching up.
- Market Competition and Risks: While the outlook for Tesla and Amazon in the AI robotics sector is optimistic, they face risks including legal and regulatory challenges, and the uncertainty of whether Tesla's robots will meet expectations, which will directly impact their stock prices and market performance.
See More
Marvell Technology Shares Surge 21.3% Amid Strong Earnings and Nvidia Investment
- Earnings Beat: Marvell Technology reported a 22.1% year-over-year revenue increase to $2.2 billion in its fourth quarter, with adjusted earnings per share rising 33.3% to $0.80, surpassing analyst expectations and showcasing robust financial performance.
- Optimistic Guidance: Management anticipates a 9% sequential revenue increase in the first quarter, projecting adjusted EPS of $0.79, indicating sustained growth potential in AI infrastructure, particularly within the data center segment.
- Collaboration with Nvidia: Nvidia's announcement of a $2 billion investment in Marvell, coupled with a product partnership, is expected to enhance Marvell's market position in AI infrastructure, particularly in the application of photonic networking technologies.
- Diversified Customer Base: Marvell has added Microsoft as a client, with Microsoft's Maia2 chip likely to drive further business growth in AI chips, demonstrating the company's adaptability and strategic positioning in a competitive market.
See More
Tesla and Amazon's Strategic Moves in Robotics Market
- Tesla's Robotics Initiative: Tesla has announced the discontinuation of its Model S and Model X, reallocating factory space to produce Optimus humanoid robots, which are set to launch by the end of 2027; if successful, this could generate high-margin recurring revenue and alleviate the impact of declining EV sales.
- Massive Market Potential: The AI robotics market is projected to reach $375.8 billion by 2035, with a compound annual growth rate of 17.33%, presenting significant growth opportunities for companies like Tesla and Amazon, thereby attracting investor interest.
- Amazon's Acquisition Moves: Amazon recently acquired Fauna Robotics, focusing on developing friendly humanoid robots for home and business use; although it lags behind Tesla in the robotics sector, its substantial cash reserves and innovation focus could enable it to catch up quickly.
- Warehouse Optimization Progress: Over the past year, Amazon has launched over a million AI-powered robots to optimize warehouse operations, and while the short-term financial impact may be limited, significant revenue could be realized if the market grows as projected.
See More
Marvell Technology Reports Strong Quarter with Nvidia Investment
- Strong Performance: Marvell reported a 22.1% revenue increase in Q4 to $2.2 billion, with adjusted EPS rising 33.3% to $0.80, surpassing analyst expectations and demonstrating the company's robust position in AI infrastructure.
- Optimistic Outlook: Management anticipates a 9% sequential revenue growth in Q1, guiding for adjusted EPS of $0.79, reflecting confidence in its data center business, particularly with a projected 40% growth in data center revenue for fiscal 2027.
- Strategic Investment: Nvidia's announcement of a $2 billion investment in Marvell, coupled with a product partnership, aims to integrate their technologies to advance the development of next-generation optical networking products for AI data centers, reinforcing Marvell's leadership in networking technology.
- Diversified Customer Base: The addition of Microsoft as a client, with its Maia2 chip leveraging Marvell's technology, indicates enhanced competitiveness in the AI chip market and alleviates concerns regarding potential market share loss with Amazon.
See More
Pershing Square Increases Holdings in Three Major Tech Stocks
- Portfolio Concentration: As of December 31, 2025, Pershing Square's investments in Amazon, Alphabet, and Meta Platforms totaled $5.9 billion, representing nearly 40% of its portfolio, reflecting strong confidence in these high-quality companies.
- Valuation Timing: Ackman entered these three companies at P/E ratios of 16, 25, and 20 during periods of weak market sentiment, indicating a strategy focused on finding value amidst uncertainty, potentially laying the groundwork for future earnings growth.
- Capital Expenditure Plans: In 2026, Alphabet plans to invest $175 billion to $185 billion, while Amazon and Meta are set to spend $200 billion and $115 billion to $135 billion on AI-related investments, demonstrating their commitment to technological innovation.
- Cash Reserve Advantage: As of December 31, 2025, these three companies collectively held $331 billion in cash and cash equivalents, significantly exceeding their long-term debt, indicating strong financial capacity for future investments and market volatility management.
See More
