Goldman Sachs Boosts Amazon Price Target to $275, Citing Underappreciated AWS Strength
ByAinvest
Friday, Oct 3, 2025 3:42 pm ET1min read
AMZN--
Goldman Sachs projects AWS to deliver more than 20% top-line growth and sustain GAAP EBIT margins in the low-to-mid-30% range across the second half of 2025 and into 2026. The firm also expects Amazon's advertising unit to achieve 16% compound annual revenue growth through 2028 [2].
Key drivers for Goldman Sachs' positive outlook include the company's revenue backlog, easing capacity constraints, expanding AI services, and returns from investments in custom silicon. The brokerage notes an upside-to-downside skew of roughly 3-to-1 from current levels, suggesting room for further gains even after this year's rally.
Beyond AWS, Amazon continues to expand its consumer and services businesses. The company has recently launched a consolidated private label grocery brand, extended autonomous vehicle testing for Zoox into Washington, D.C., and signed new partnerships with the NBA and FanDuel [2].
Goldman Sachs' revision underscores investor confidence that cloud growth and advertising demand will offset competitive pressures in retail. The next earnings report will be a key test of these expectations.
Goldman Sachs is reiterating Amazon as a top pick ahead of Q3 earnings, citing underappreciation of AWS' growth and profit potential. The brokerage raised its price target to $275 from $240, forecasting 16% compound annual revenue growth for Amazon's advertising unit through 2028. Goldman sees a pathway for AWS to return to over 20% revenue growth and sustain low-to-mid-30% operating margins through 2025 and 2026.
Goldman Sachs has reiterated its buy recommendation on Amazon.com (NASDAQ: AMZN) and raised its price target to $275 from $240, ahead of the company's third-quarter earnings report. The brokerage maintains a positive outlook on Amazon, citing underappreciated growth potential in its AWS cloud segment and strong performance in its advertising business [1].Goldman Sachs projects AWS to deliver more than 20% top-line growth and sustain GAAP EBIT margins in the low-to-mid-30% range across the second half of 2025 and into 2026. The firm also expects Amazon's advertising unit to achieve 16% compound annual revenue growth through 2028 [2].
Key drivers for Goldman Sachs' positive outlook include the company's revenue backlog, easing capacity constraints, expanding AI services, and returns from investments in custom silicon. The brokerage notes an upside-to-downside skew of roughly 3-to-1 from current levels, suggesting room for further gains even after this year's rally.
Beyond AWS, Amazon continues to expand its consumer and services businesses. The company has recently launched a consolidated private label grocery brand, extended autonomous vehicle testing for Zoox into Washington, D.C., and signed new partnerships with the NBA and FanDuel [2].
Goldman Sachs' revision underscores investor confidence that cloud growth and advertising demand will offset competitive pressures in retail. The next earnings report will be a key test of these expectations.
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