Amazon (AMZN) investors were pleased after the tech company announced that OpenAI’s open-weight models are now available through its AWS cloud platform. These models can be used by businesses through Amazon’s Bedrock and SageMaker tools, which help companies build AI applications using their own data. While this isn’t a huge shift in the AI cloud race that is currently led by tech rival Microsoft (MSFT), analysts still see it as a positive first move for Amazon, especially since its recent cloud earnings left investors wondering if AWS was falling behind.
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According to BofA Securities, this new arrangement doesn’t mean AWS will benefit from OpenAI’s infrastructure spending the way Microsoft does, but it does give AWS a chance to make money by offering services built around these models. AWS head Matt Garman described the partnership as a “powerhouse combination” that combines OpenAI’s technology with AWS’ scale and security. Although OpenAI remains closely tied to Microsoft, it recently began allowing other cloud providers like Oracle (ORCL) and CoreWeave (CRWV) to host its models, which created space for new partnerships like this one with Amazon.
It is worth noting that right now, Amazon is only offering access to OpenAI’s freely available open-weight models, not the more powerful “closed” models like GPT-5. Still, analysts, like those at New Street Research, believe this could be the start of something bigger. Amazon already supports open models from Meta (META) and Alphabet (GOOGL), and this adds to its AI offerings. Although Amazon’s cloud growth has been slower than Microsoft’s and Google’s, and its stock dropped 8% after Q2 earnings, some analysts are optimistic that the OpenAI partnership could give AWS a much-needed boost.
What Is the Price Target for AMZN Stock?
Turning to Wall Street, analysts have a Strong Buy consensus rating on Amazon stock based on 43 Buys and one Hold assigned in the past three months. Furthermore, the average AMZN stock price target of $264.21 per share implies 18.6% upside potential from current levels.
