Amazon Shares Poised to Break $300 as Cloud and AI Momentum Accelerates
With AWS revenue growth expected to hit 30% and the AI chip business exceeding a $20 billion run rate, investors are weighing strong fundamentals against mixed analyst recommendations.
Amazon shares, currently trading in the vicinity of $274, are positioned to breach the $300 mark by the end of 2026, according to market projections. This bullish outlook is anchored by accelerating performance across its core business segments, particularly within Amazon Web Services (AWS), which has emerged as the primary driver of recent investor optimism. The average one-year price target set by Wall Street analysts stands at $319, reflecting confidence in the company’s ability to sustain high growth rates in a competitive technology landscape.
The acceleration in AWS revenue growth has been a key focal point for institutional investors. After dipping to 13% year-on-year in the fourth quarter of 2023, following a 20% growth rate in the same period the previous year, AWS growth rebounded sharply. By the first quarter of 2025, sales surged 28% year-on-year as enterprises increasingly utilised Amazon’s infrastructure to build digital foundations for artificial intelligence applications. Analysts anticipate this momentum could push AWS revenue growth to 30% later this year, providing significant tailwinds for the broader stock price.
Beyond cloud computing, Amazon’s advertising unit has demonstrated robust expansion, generating over $70 billion in revenue over the past 12 months. The segment recorded consecutive quarters of year-on-year growth exceeding 20%, including a 24% increase in the first quarter. Chief Executive Andy Jassy highlighted the integration of advertising into the shopping experience as a critical success factor. Additionally, the company’s nascent AI chip business has surpassed a $20 billion annualised revenue run rate, further diversifying its infrastructure revenue streams.
The company’s strategic diversification extends into satellite internet through its Amazon Leo service, a competitor to Starlink. Delta Airlines has selected Amazon Leo to provide in-flight Wi-Fi starting in 2028, marking a significant commercial validation of the technology. This move underscores Amazon’s broader ambition to capture market share in speculative ventures with long-term potential, complementing its established dominance in e-commerce and cloud services.
Despite the positive trajectory, not all investment teams are recommending immediate entry. The Motley Fool’s Stock Advisor team, which tracks high-potential equities, did not include Amazon in its current list of 10 best stocks to buy, despite the favourable price outlook. The stock recently experienced a 31.9% surge in a single month following the release of fourth-quarter fiscal 2025 results, which reported $213.4 billion in revenue and $25 billion in operating income. For the second quarter, Amazon’s guidance implies year-on-year revenue growth of 16% to 19%, suggesting steady, if not explosive, near-term performance.
