Amazon Shares Soar 2.97% on AI Partnership, Tariff News

Amazon.com, Inc. (AMZN) shares surged 2.97% intraday, reaching their highest level since February 2025, marking a fifth consecutive day of gains and a 14.25% increase over the past five days.

The strategy of buying Amazon (AMZN) shares after they reached a recent high and holding for 1 week yielded moderate returns over the past 5 years, with a 9.77% annualized gain. This approach capitalized on the stock's volatility and subsequent recovery, though the returns were somewhat muted due to the shorter holding period.

Amazon's strategic partnership with Saudi Arabian AI firm Humain has garnered significant attention. The collaboration involves a $5 billion investment in an "AI Zone" in Saudi Arabia, aimed at fostering AI innovation on a global scale. This move not only enhances Amazon's presence in the Middle East but also underscores its commitment to advancing AI technologies, which could drive future growth and operational efficiencies.

Amazon's recent financial performance has been robust, with a 10% year-over-year increase in revenue to $155.7 billion and a 20% rise in operating income to $18.4 billion as of May 1, 2025. The company's cloud computing division, AWS, contributed significantly to this success, reporting a 17% year-over-year growth in revenue. These strong financial results have bolstered investor confidence in Amazon's ability to sustain growth and profitability.

Tariff developments have also played a role in Amazon's stock price movements. Recent favorable tariff news has alleviated concerns about potential trade barriers, leading to a positive market response and a surge in AMZN shares. This development has provided a tailwind for Amazon's stock, contributing to its recent upward trajectory.