JPMorgan Raises Amazon Stock Target Following Strong AI-Driven Earnings
Amazon (AMZN) delivered a strong earnings report in which its cloud division AWS showed significant growth, prompting JPMorgan to raise its price target for the stock. Wall Street had been concerned about capital expenditures and whether AWS could justify continued investment with sufficient returns. However, Amazon exceeded expectations by reporting robust revenue increases across both overall sales (up 20%) and AWS specifically (37% year-over-year). The cloud segment also saw a record backlog of $496 billion and rising operating profits. JPMorgan analyst Doug Anmuth raised the price target for AMZN to $365 from $330, maintaining an Overweight rating. This adjustment reflects confidence in AWS's ability to convert AI-driven demand into long-term profitability despite near-term cash flow challenges due to infrastructure spending. The stock surged 15.3% following earnings and has outperformed the S&P 500 year-to-date. While Amazon’s guidance for Q3 was modest, it still supports a bullish outlook given AWS's strong performance in AI-related services like Graviton CPUs.
Topics: AI investment AWS earnings report price target upgrade