Amazon.com (NASDAQ:AMZN) Shares Up 15.3% Following Strong Earnings

Key Points

• Amazon shares surged 15.3% to $271.58 after the company reported quarterly EPS of $5.75, far above the $1.82 consensus estimate. Revenue rose 19.6% year over year to $200.61 billion, also exceeding expectations.
• AWS growth reaccelerated by 36.7% to approximately $42.2 billion, supported by strong enterprise AI demand and arrangements with Meta and OpenAI. Advertising revenue and operating income also posted substantial gains.
• Analysts remained broadly bullish, with 57 Buy ratings and three Holds, producing a “Moderate Buy” consensus and an average price target of $321.40. Executives and other insiders sold shares under pre-arranged Rule 10b5-1 trading plans, while institutional investors own 72.2% of the stock.

Amazon.com, Inc. (NASDAQ:AMZN)'s stock price traded up 15.3% during trading on Friday following a better than expected earnings announcement. The company traded as high as $273.23 and last traded at $271.58. 128,419,627 shares traded hands during mid-day trading, an increase of 157% from the average daily volume of 49,951,809 shares. The stock had previously closed at $235.50.

The e-commerce giant reported $5.75 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.82 by $3.93. Amazon.com had a return on equity of 19.92% and a net margin of 12.22%.The firm had revenue of $200.61 billion for the quarter, compared to analyst estimates of $197.03 billion. During the same quarter last year, the firm posted $1.68 EPS. The business's revenue was up 19.6% on a year-over-year basis.

More Amazon.com News

Here are the key news stories impacting Amazon.com this week:

• Positive Sentiment: AWS growth reaccelerated: Amazon Web Services revenue rose 36.7% year over year to approximately $42.2 billion, its fastest growth in 18 quarters. Strong enterprise AI demand, including arrangements with Meta and OpenAI, helped ease concerns that heavy AI spending would not produce adequate returns. Amazon jumps as AWS growth soothes fears over rising AI spending
• Positive Sentiment: Broad earnings beat: Revenue increased about 20% to $200.6 billion, exceeding expectations, while reported EPS of $5.75 was well above consensus. Operating income rose more than 40%, advertising revenue climbed 26% to nearly $20 billion, and North American sales benefited from solid consumer demand. Amazon.com Announces Second Quarter Results
• Positive Sentiment: AI monetization and capacity visibility improved: Management cited striking demand extending into 2028, growing use of custom AI chips and AI agents, and a large AWS backlog. Analysts responded by raising targets, including JPMorgan’s $365 and Benchmark’s $400 targets. Amazon's AI Bet Wins Big
• Positive Sentiment: Additional growth initiatives: Amazon completed its planned $50 billion investment in OpenAI, expanded robotics to improve fulfillment efficiency, and received regulatory clearance for Amazon-owned Zoox to begin paid robotaxi rides. Amazon Completes $50 Billion Investment in OpenAI

Analyst Upgrades and Downgrades

A number of analysts have recently commented on AMZN shares. UBS Group set a $318.00 target price on shares of Amazon.com and gave the stock a "buy" rating in a research note on Friday. Maxim Group raised their price target on shares of Amazon.com from $290.00 to $315.00 and gave the company a "buy" rating in a research note on Thursday, April 30th. Needham & Company LLC reiterated a "buy" rating and issued a $300.00 price objective on shares of Amazon.com in a report on Friday. Citigroup reiterated a "buy" rating and set a $350.00 price objective (up from $325.00) on shares of Amazon.com in a research note on Friday. Finally, Arete Research increased their target price on Amazon.com from $301.00 to $310.00 and gave the company a "buy" rating in a report on Monday, May 18th. Fifty-seven equities research analysts have rated the stock with a Buy rating and three have given a Hold rating to the company. Based on data from MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus price target of $321.40.

Insider Activity

In other Amazon.com news, VP Shelley Reynolds sold 2,363 shares of the firm's stock in a transaction that occurred on Thursday, May 21st. The shares were sold at an average price of $262.38, for a total value of $620,003.94. Following the transaction, the vice president directly owned 119,780 shares of the company's stock, valued at $31,427,876.40. This trade represents a 1.93% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Andrew R. Jassy sold 31,352 shares of the business's stock in a transaction that occurred on Monday, May 4th. The stock was sold at an average price of $275.00, for a total value of $8,621,800.00. Following the transaction, the chief executive officer owned 2,175,766 shares in the company, valued at approximately $598,335,650. This represents a 1.42% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 135,719 shares of company stock valued at $36,438,002 in the last ninety days. 8.90% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Amazon.com

Institutional investors have recently added to or reduced their stakes in the stock. Brighton Jones LLC raised its position in shares of Amazon.com by 10.9% during the 4th quarter. Brighton Jones LLC now owns 4,036,091 shares of the e-commerce giant's stock valued at $885,478,000 after buying an additional 397,007 shares during the period. Revolve Wealth Partners LLC grew its position in Amazon.com by 4.1% in the fourth quarter. Revolve Wealth Partners LLC now owns 25,045 shares of the e-commerce giant's stock worth $5,495,000 after acquiring an additional 986 shares during the period. Bank Pictet & Cie Europe AG increased its stake in Amazon.com by 2.8% during the fourth quarter. Bank Pictet & Cie Europe AG now owns 2,016,869 shares of the e-commerce giant's stock worth $442,481,000 after acquiring an additional 54,987 shares during the last quarter. Highview Capital Management LLC DE increased its stake in Amazon.com by 5.5% during the fourth quarter. Highview Capital Management LLC DE now owns 28,975 shares of the e-commerce giant's stock worth $6,357,000 after acquiring an additional 1,518 shares during the last quarter. Finally, Liberty Square Wealth Partners LLC purchased a new stake in Amazon.com in the fourth quarter valued at $2,153,000. Hedge funds and other institutional investors own 72.20% of the company's stock.

Amazon.com Price Performance

The stock has a 50-day simple moving average of $245.59 and a 200 day simple moving average of $235.97. The company has a market cap of $2.92 trillion, a PE ratio of 32.49, a P/E/G ratio of 1.70 and a beta of 1.46. The company has a quick ratio of 1.01, a current ratio of 1.18 and a debt-to-equity ratio of 0.27.

About Amazon.com

Amazon.com, Inc is a diversified technology and retail company best known for its e-commerce marketplace and broad portfolio of consumer and enterprise services. Founded by Jeff Bezos in 1994 and headquartered in Seattle, Washington, the company launched as an online bookseller and expanded into a global retail platform that sells products directly to consumers and provides a marketplace for third-party sellers. Over time Amazon has grown beyond retail into areas including cloud computing, digital media, devices and logistics.

Key businesses and offerings include Amazon's online marketplace and fulfillment services, the Amazon Prime membership program (which bundles expedited shipping with streaming and other benefits), Amazon Web Services (AWS) which supplies on-demand cloud computing and storage to businesses and public-sector customers, and a range of content and advertising services such as Prime Video and Amazon Advertising.

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