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Amazon Stock: Is It a Buy in 2026?
21 Dec, 2025
Summary
- AWS cloud growth accelerated to 20% last quarter.
- North American retail sales grew 11% year-over-year.
- Amazon stock has underperformed market indexes recently.
Amazon's stock has trailed market indexes over the past five years, with the S&P 500 gaining 98% versus Amazon's 40%. However, its underlying operations remain robust, prompting questions about its current valuation for 2026.
Amazon Web Services (AWS) demonstrated accelerated growth, with revenues increasing by 20% year-over-year to $33 billion in the last quarter. This growth is partly fueled by significant spending from AI startups like Anthropic, indicating AWS's continued profitability and importance, independent of AI trends.
The e-commerce giant's North American retail sector also saw substantial gains, with sales up 11% year-over-year, exceeding $100 billion last quarter. High-margin business lines like advertising and third-party seller services contributed nearly $300 billion in annualized sales, suggesting potential for expanding profit margins.
