Amazon's Q1 Earnings: Strong Profit, Uncertain Tariff Impact

Amazon reported Q1 2025 earnings with $155.7 billion in revenue, up 9% YoY, and a 64% surge in net income to $17.1 billion. AWS generated $29.3 billion in revenue and $11.5 billion in operating income, while advertising grew 19% YoY. Despite strong results, shares dipped 2.5% in after-hours trading due to concerns about soft Q2 guidance and the impact of new US tariffs on China.

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Title: Amazon's Q1 2025 Earnings: Strong Revenue Growth Amid Market Concerns

Amazon.com Inc. (NASDAQ: AMZN) reported its Q1 2025 earnings with a significant increase in revenue and net income, but the stock experienced a dip in after-hours trading due to concerns about future guidance and tariffs. The company reported $155.7 billion in revenue, up 9% year-over-year (YoY), and a 64% surge in net income to $17.1 billion. AWS generated $29.3 billion in revenue and $11.5 billion in operating income, while advertising grew 19% YoY [1].

The strong performance in Q1 was driven by robust growth in key segments. AWS, Amazon's cloud computing arm, continued to be a major growth driver, with revenue up 17% YoY. Advertising revenue also showed significant growth, increasing by 19% YoY. Despite these positive results, investors were concerned about the company's Q2 guidance and the potential impact of new US tariffs on China, which led to a 2.5% drop in the stock price after hours [1].

Analysts have been closely monitoring Amazon's performance and providing varying forecasts. Piper Sandler recently lowered its price target for Amazon to $215, but maintained an "Overweight" rating, expecting Q1 revenue of $153 billion and within the $151 billion to $155 billion guidance range. Jefferies also lowered its price target to $250 but maintained a "Buy" rating, aligning with the firm's expectation of softening macro factors impacting tech deal decisions [1].

Looking ahead, investors will be focused on Amazon's ability to maintain its growth trajectory and navigate potential headwinds. The company continues to invest heavily in AI, cloud computing, and same-day delivery services, which could drive future growth. However, ongoing labor issues and increasing costs of AI investment could pose challenges [1].

Amazon's stock has faced volatility in 2025, with a significant decline following its all-time high in February. Despite this, the stock remains popular among institutional investors, with more than 63% of shares held by these investors. Analysts generally maintain a "Strong Buy" rating for the stock, with a consensus price target of $246.70, indicating strong upside potential [1].

In conclusion, Amazon's Q1 2025 earnings demonstrate the company's resilience and continued growth in key segments. However, investors will need to closely monitor future guidance and external factors that could impact the stock's performance.

References:
[1] https://247wallst.com/investing/2025/04/28/amazon-stock-price-prediction-where-will-it-be-in-1-year/

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