Merchandise Libero's 15-minute chart has recently exhibited a KDJ Golden Cross, accompanied by a bullish Marubozu pattern on July 8, 2025, at 15:30. This development indicates that the momentum of the stock price is transitioning towards an upward trajectory, and there is a potential for further growth. The buyers have asserted their dominance, thereby controlling the market, and the bullish momentum is likely to persist.
Amazon.com, Inc. (AMZN) has shown remarkable resilience and growth potential, surging 30.9% over the past three months, outperforming the broader Zacks Retail-Wholesale sector and the S&P 500’s return of 21.4% and 26%, respectively [1]. This impressive performance can be largely attributed to the company's cloud computing and artificial intelligence (AI) initiatives.
Amazon Web Services (AWS), a key driver of Amazon's growth, generated $29.3 billion in first-quarter revenues with a 16.9% year-over-year growth, translating to an annualized run rate of $117 billion [1]. AWS's operating margins expanded to 39.5%, demonstrating exceptional scalability and pricing power as organizations accelerate their digital transformation initiatives. The segment's substantial backlog of $189 billion, with a 4.1-year weighted average life, provides unprecedented revenue visibility and supports long-term growth projections [1].
AWS's market share dominance is evident, with a 29.1% share of the cloud infrastructure market, followed by Microsoft's 40.7% and Google's 24.1% [1]. This strong performance is further bolstered by recent customer acquisitions spanning diverse industries, including Adobe, Uber, and Nasdaq, demonstrating AWS's ability to capture market share across various sectors.
Amazon's AI business has also achieved significant milestones, with a multi-billion-dollar annual run rate and triple-digit growth rates [1]. Recent developments such as the introduction of Amazon Nova Canvas with AI-powered image generation capabilities, the availability of Anthropic Claude 4 models through Amazon Bedrock, and the launch of DeepSeek-R1 models showcase Amazon's commitment to AI leadership [1]. These innovations provide customers with comprehensive AI solutions while creating additional revenue streams for Amazon.
Project Rainier, an ambitious infrastructure investment in AI compute capabilities, highlights Amazon's willingness to invest heavily in foundational AI infrastructure [1]. This initiative aims to train next-generation AI models through powerful Trainium2 chip clusters, potentially creating significant barriers to entry for competitors while establishing AWS as the preferred platform for AI workload deployment.
Amazon's first-quarter financial results reflect the company's operational efficiency and margin expansion capabilities. Net income increased 64.4% year over year to $17.1 billion, while operating income rose 20.2% to $18.4 billion, representing 11.8% of revenues [1]. The company's balance sheet remains robust with $66.2 billion in cash and equivalents, providing substantial financial flexibility for continued AI infrastructure investments and strategic initiatives [1].
The Zacks Consensus Estimate for 2025 net sales is pegged at $694.49 billion, indicating growth of 8.86% from the prior-year reported figure [1]. The Zacks Consensus Estimate for 2025 earnings is pegged at $6.22 per share, which indicates a jump of 0.5% from the year-ago period [1].
Investors should exercise patience given Amazon's forward 12-month price-to-sales ratio of 3.25X, significantly above the Zacks Internet - Commerce industry average of 2.17X [1]. This valuation premium suggests the stock may be fully valued at current levels, warranting a more strategic entry point during potential market corrections or company-specific volatility.
Current Amazon shareholders should maintain their positions as AWS and AI initiatives drive fundamental business transformation. The combination of sustained cloud growth, expanding AI capabilities, and improving operational efficiency supports the stock's recent 30.9% appreciation while indicating continued upside potential throughout 2025 [1].
References:
[1] https://www.nasdaq.com/articles/3-reasons-hold-amzn-stock-aws-ai-drive-31-growth-3-months
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