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Amazon (AMZN)
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Amazon (AMZN) AI Stock Analysis

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AMZN

Amazon

(NASDAQ:AMZN)

Rating:81Outperform
Price Target:
$257.00
▲(8.97% Upside)
Amazon's overall stock score is driven by strong financial performance and positive earnings call insights, highlighting robust growth and strategic advancements. While technical analysis and valuation suggest caution, the company's innovation and market leadership position it well for future growth.
Positive Factors
AWS Growth
AWS growth has the potential to accelerate to 20%+ in '26, which is a key driver of AMZN's multiple.
Financial Performance
Amazon remains a top-pick with a Buy rating.
Grocery Expansion
The expansion into the grocery sector taps into a significant offline consumer spending market, positioning Amazon to capture a larger share.
Negative Factors
AWS Margin
AWS margin fell to the lowest in six quarters due to heavy AI investments, despite strong growth.
Competition
Amazon has been losing modest share in online grocery to competitors like Walmart and DoorDash due to factors like price and convenience.

Amazon (AMZN) vs. SPDR S&P 500 ETF (SPY)

Amazon Business Overview & Revenue Model

Company DescriptionAmazon.com, Inc. engages in the retail sale of consumer products and subscriptions through online and physical stores in North America and internationally. The company operates through three segments: North America, International, and Amazon Web Services (AWS). Its products offered through its stores include merchandise and content purchased for resale; and products offered by third-party sellers The company also manufactures and sells electronic devices, including Kindle, Fire tablets, Fire TVs, Rings, Blink, eero, and Echo; and develops and produces media content. In addition, it offers programs that enable sellers to sell their products in its stores; and programs that allow authors, musicians, filmmakers, Twitch streamers, skill and app developers, and others to publish and sell content. Further, the company provides compute, storage, database, analytics, machine learning, and other services, as well as fulfillment, advertising, and digital content subscriptions. Additionally, it offers Amazon Prime, a membership program. The company serves consumers, sellers, developers, enterprises, content creators, and advertisers. Amazon.com, Inc. was incorporated in 1994 and is headquartered in Seattle, Washington.
How the Company Makes MoneyAmazon generates revenue through several key streams. The largest portion comes from its e-commerce business, where it sells a vast array of products directly to consumers and acts as a marketplace for third-party sellers, earning fees on sales. Another significant revenue stream is Amazon Web Services (AWS), which provides cloud computing services to businesses and organizations, contributing substantially to the company's profitability. Additionally, Amazon earns revenue from subscription services, primarily through Amazon Prime, as well as advertising services on its platform. Strategic partnerships, such as those with other retailers and technology companies, enhance its service offerings and drive additional revenue.

Amazon Key Performance Indicators (KPIs)

Any
Any
AWS Performance Obligations
AWS Performance Obligations
Reflects future revenue commitments for AWS services, indicating the strength of customer demand and the potential for sustained growth in Amazon's cloud business.
Chart InsightsAWS performance obligations have shown consistent growth, reaching $189 billion by Q1 2025, reflecting strong demand and long-term commitments. The earnings call highlighted AWS's 17% year-over-year revenue growth, driven by expanding AI capabilities and a $117 billion annualized revenue run rate. This growth underscores AWS's strategic importance to Amazon's overall business, despite broader economic uncertainties and tariff impacts. The focus on AI and cloud services positions AWS as a key driver of Amazon's future revenue streams, enhancing its competitive edge in the tech sector.
Data provided by:Main Street Data

Amazon Earnings Call Summary

Earnings Call Date:Jul 31, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Positive
The earnings call reflected strong revenue growth and successful performance across multiple segments, including AWS and advertising. However, challenges such as declining AWS margins and ongoing supply constraints were noted. Despite these challenges, the overall sentiment is positive due to significant growth and strategic advancements.
Q2-2025 Updates
Positive Updates
Strong Revenue Growth
Amazon reported $167.7 billion in revenue for Q2 2025, up 12% year-over-year, excluding the impact from foreign exchange rates.
Operating Income Increase
Operating income was $19.2 billion, up 31% year-over-year.
AWS Performance
AWS grew 17.5% year-over-year and now has over $123 billion annualized revenue run rate.
Advertising Revenue Growth
Amazon's advertising revenue grew 22% year-over-year, totaling $15.7 billion.
Prime Day Success
This year's Prime Day was Amazon's biggest ever, with record sales and customer savings of billions of dollars.
International Segment Improvement
International segment revenue was $36.8 billion, an increase of 11% year-over-year, and operating margin increased by 320 basis points.
Advancements in Delivery and Logistics
Amazon reduced the average distance packages traveled by 12% and improved delivery speeds, with 30% more items delivered same day or next day in the U.S. compared to the previous year.
Progress in Robotics and AI
Amazon deployed its 1 millionth robot and introduced DeepFleet, improving robot travel efficiency by 10%.
Negative Updates
AWS Margin Decline
AWS operating margins decreased from 39.5% in Q1 to 32.9% in Q2, primarily due to stock-based compensation expenses and higher depreciation costs.
Supply Constraints in AWS
AWS faced supply constraints, particularly in power, affecting its ability to meet demand. This is expected to take several more quarters to resolve.
Tariff Uncertainty
There remains uncertainty regarding the impact of tariffs, particularly in China, which could affect costs and consumer prices in the future.
Company Guidance
During Amazon's Q2 2025 financial results call, the company provided guidance for the upcoming quarter, forecasting net sales between $174 billion and $179.5 billion, with an anticipated favorable foreign exchange impact of approximately 130 basis points. The guidance reflects Amazon's focus on key performance drivers such as price, selection, and convenience, including improved delivery speeds and inventory positioning. Despite ongoing uncertainties surrounding tariffs and economic conditions, Amazon remains cautiously optimistic about its growth trajectory, buoyed by successful initiatives like Prime Day and advancements in its AWS and advertising segments.

Amazon Financial Statement Overview

Summary
Amazon's financial performance is strong with robust revenue growth and profitability. The income statement shows a significant revenue increase with healthy margins. The balance sheet is solid, with a manageable debt-to-equity ratio and impressive ROE, while cash flow statements indicate strong operational cash generation despite high capital expenditures.
Income Statement
89
Very Positive
Amazon's income statement shows robust growth and profitability. The TTM (Trailing-Twelve-Months) period reflects a significant revenue increase with a Gross Profit Margin of approximately 45.7% and a Net Profit Margin of 10.5%, indicating strong operational efficiency. The EBIT and EBITDA margins are also healthy at 11.4% and 19.2% respectively, highlighting substantial earnings before interest and taxes. Revenue growth from the previous year is impressive at 5%, demonstrating Amazon's ability to scale effectively.
Balance Sheet
85
Very Positive
The balance sheet is strong with substantial equity represented by a Debt-to-Equity Ratio of 0.40, indicating manageable leverage levels. The Return on Equity (ROE) is an impressive 21.2%, reflecting efficient use of equity to generate profits. An Equity Ratio of 48.9% suggests a solid capital structure with a good balance between debt and equity financing, although there is room for improvement in asset management.
Cash Flow
80
Positive
Amazon's cash flow statements show strong operational cash generation with a positive Free Cash Flow to Net Income ratio, demonstrating efficient cash management. The Free Cash Flow Growth Rate is negative, primarily due to high capital expenditures, but the company maintains a healthy Operating Cash Flow to Net Income ratio of 1.72, indicating strong cash flow relative to net income.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue670.04B637.96B574.78B513.98B469.82B386.06B
Gross Profit306.41B311.67B270.05B225.15B197.48B152.76B
EBITDA128.49B123.81B89.40B38.35B74.39B51.01B
Net Income70.62B59.25B30.43B-2.72B33.36B21.33B
Balance Sheet
Total Assets682.17B624.89B527.85B462.68B420.55B321.19B
Cash, Cash Equivalents and Short-Term Investments93.18B101.20B86.78B70.03B96.05B84.40B
Total Debt133.94B130.90B135.61B140.12B116.39B84.39B
Total Liabilities348.39B338.92B325.98B316.63B282.30B227.79B
Stockholders Equity333.77B285.97B201.88B146.04B138.25B93.40B
Cash Flow
Free Cash Flow13.48B32.88B32.22B-16.89B-14.73B25.92B
Operating Cash Flow121.14B115.88B84.95B46.75B46.33B66.06B
Investing Cash Flow-123.57B-94.34B-49.83B-37.60B-58.15B-59.61B
Financing Cash Flow-8.65B-11.81B-15.88B9.72B6.29B-1.10B

Amazon Technical Analysis

Technical Analysis Sentiment
Positive
Last Price235.84
Price Trends
50DMA
225.89
Positive
100DMA
212.98
Positive
200DMA
213.37
Positive
Market Momentum
MACD
2.30
Negative
RSI
60.03
Neutral
STOCH
87.45
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMZN, the sentiment is Positive. The current price of 235.84 is above the 20-day moving average (MA) of 228.25, above the 50-day MA of 225.89, and above the 200-day MA of 213.37, indicating a bullish trend. The MACD of 2.30 indicates Negative momentum. The RSI at 60.03 is Neutral, neither overbought nor oversold. The STOCH value of 87.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMZN.

Amazon Risk Analysis

Amazon disclosed 24 risk factors in its most recent earnings report. Amazon reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Amazon Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
$2.48T35.4624.77%10.87%56.13%
79
Outperform
$173.15B13.5931.78%20.09%-1.83%
78
Outperform
$322.43B15.3315.22%1.46%5.48%128.65%
78
Outperform
$113.44B97.2314.48%34.12%
73
Outperform
$122.56B59.7043.83%38.27%46.21%
62
Neutral
$52.70B145.578.55%18.69%-65.55%
61
Neutral
$17.92B12.81-3.11%2.97%1.30%-14.28%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
AMZN
Amazon
235.84
60.44
34.46%
MELI
Mercadolibre
2,417.49
387.58
19.09%
BABA
Alibaba
135.58
55.48
69.26%
SE
Sea
190.57
113.66
147.78%
PDD
PDD Holdings
124.68
32.22
34.85%
CPNG
Coupang
28.91
6.50
29.00%

Amazon Corporate Events

Executive/Board ChangesShareholder Meetings
Amazon Shareholders Meeting Highlights Key Decisions
Neutral
May 22, 2025

On May 21, 2025, Amazon held its Annual Meeting of Shareholders where several directors were elected, and Ernst & Young LLP was ratified as the independent auditor for 2025. Despite the approval of executive compensation, multiple shareholder proposals, including those on CEO-Chair separation, advertising risks, emissions reporting, and AI oversight, were not approved, indicating a potential disconnect between shareholder interests and company decisions.

The most recent analyst rating on (AMZN) stock is a Buy with a $220.00 price target. To see the full list of analyst forecasts on Amazon stock, see the AMZN Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 07, 2025