Amazon's Earnings Stagnate Amid Wait for Next Catalyst

Amazon has underperformed the S&P 500 by 9 percentage points since being downgraded to a Hold by the author, who previously reaped 31% profits. Despite this, Amazon remains a significant player in the market and continues to be a key player in the tech industry. However, the author notes that the company is currently in a stalemate, waiting for the next catalyst to drive growth.

Amazon.com, Inc. (NASDAQ: AMZN) has been in a phase of underperformance since being downgraded to a Hold by an analyst in July 2025. The stock has lagged behind the S&P 500 by 9 percentage points, despite the broader market rallying by 6% in the same period. This underperformance can be attributed to the lack of a near-term catalyst to drive growth, as noted by the analyst in a Seeking Alpha analysis.

Despite this, Amazon remains a significant player in the tech industry and continues to expand its global presence. In October 2025, a Reuters report on Yahoo Finance said that Amazon plans to invest 1 billion euros ($1.16 billion) in Belgium from 2025 to 2027, aiming to develop infrastructure and enhance its supply chain in the country. This investment, while substantial, is part of Amazon's broader strategy to expand its global footprint and improve delivery times.

In addition to its infrastructure investments, Amazon is also strengthening its partnerships with local companies like Bpost to enhance its supply chain in Belgium. The company aims to offer same-day delivery services in the country, highlighting its commitment to improving customer experience, as reported by Reuters via Yahoo Finance.

Amazon's quantum computing initiatives have also gained significant attention. Zacks Investment Research highlighted Amazon in Zacks' analyst blog as one of the leading players in the quantum computing space, noting its advancements in quantum computing hardware and software. The company's proprietary Ocelot chip, which uses "cat qubits" to improve error correction and cut costs, is a key innovation in this area. Furthermore, Amazon's collaboration with the U.S. Department of Energy and General Dynamics Information Technology on quantum technologies positions it to leverage government partnerships and investments in this emerging field.

However, Amazon's current valuation remains relatively stable, with the EV to forward EBITDA ratio hovering around 14x. While this is not expensive, it is not the usual value territory where Amazon Buys have been more rewarded in the recent past, as noted in the Seeking Alpha analysis. The company's valuation reflects the current macro environment, which includes supportive equity valuations due to a 25 bps rate cut but also faces broader market pressure factors.

In conclusion, while Amazon is currently in a stalemate, waiting for the next catalyst to drive growth, its long-term prospects remain promising. The company's investments in infrastructure, partnerships, and emerging technologies like quantum computing position it for future growth. Investors should keep an eye on Amazon's quarterly earnings reports and any announcements regarding new catalysts that could drive the stock's performance.