Amazon Stock (AMZN) Gains Momentum as AI and Cloud Expansion Accelerate

• AWS revenue surged 20.2% year-over-year with a $200 billion AI infrastructure backlog.
• Amazon's retail margins hit 8% through shipping optimizations and ultra-fast delivery tests.
• Advertising revenue rose 22% to $17.7 billion and may contribute 35% of operating income by 2025.
• Data center investments reached $61 billion in 2025 as AI workloads strain power capacity.
• Analysts project 11.9% revenue growth for 2025 driven by AWS and high-margin segments.

Amazon (AMZN) continues demonstrating robust growth across its three core pillars: cloud computing, e-commerce efficiency, and digital advertising. The company's strategic investments in AI infrastructure and logistics optimization are translating into tangible financial gains. AWS maintains leadership in cloud services while retail innovations boost profitability and advertising scales into a major earnings driver. These converging strengths position Amazon for sustained expansion despite macroeconomic uncertainties.

Can AWS Growth Fuel Amazon Stock's Next Rally?

AWS revenue jumped to $33 billion last quarter, powered by enterprise AI adoption. A $200 billion backlog for AI infrastructure ensures multiyear revenue visibility as demand strains global data center capacity. Amazon is doubling power resources since 2022, adding 3.8 gigawatts in just twelve months. Each new gigawatt could generate approximately $3 billion in annual revenue according to Oppenheimer analysis. Custom AI chips like Graviton and Trainium are projected to surge 70% in 2025, enhancing Amazon's competitive edge. This positions AWS to capitalize on the industry's record $61 billion data center deal activity. AWS remains Amazon's primary growth engine with triple-digit AI infrastructure expansion.

How Will Retail Efficiency and Advertising Boost Amazon Stock?

Retail margins expanded to 8% through shipping innovations and regional fulfillment. Amazon tests 30-minute deliveries in select markets, potentially disrupting logistics by 2026. E-commerce sales grew 5.1% year-over-year in Q3 2025, outperforming overall retail. AI personalization drives conversion through advanced product recommendations and emerging agentic commerce. Advertising revenue hit $17.7 billion with 22% annual growth through Prime Video integrations and Netflix partnerships. This segment could deliver 35% of Amazon's operating income next year due to superior margins. Social commerce trends amplify opportunities, with 46% of Gen Z using TikTok for product discovery. Retail efficiency combined with advertising's rise creates a powerful profit engine beyond AWS.

Analysts cite improving operating leverage and high-margin segment growth for sustained $300+ price targets.