Amazon is experiencing a dramatic resurgence, powered by the artificial intelligence revolution that has ignited exceptional performance in its cloud computing division. Following several quarters of disappointing results, the technology behemoth has staged an impressive recovery, setting a positive tone as it approaches the critical holiday season.
Broad-Based Financial Strength
The company’s latest earnings report revealed substantial growth across multiple business segments. Total revenue climbed 13% to $180.2 billion, while earnings per share saw a dramatic 36% increase. Even Amazon’s established advertising business demonstrated robust health, expanding by 24% and reinforcing its position as the world’s third-largest advertising platform.
Market response was overwhelmingly positive, with shares soaring more than 11% following the earnings release to reach unprecedented heights. The renewed confidence in Amazon’s growth narrative prompted at least 23 brokerage firms to upgrade their price targets for the company’s stock.
Cloud Division Drives Momentum
At the core of Amazon’s resurgence lies Amazon Web Services (AWS), the company’s cloud computing arm. AWS delivered its strongest performance since 2022, achieving 20% growth and generating $33.0 billion in revenue—surpassing all market expectations. This acceleration comes at an ideal moment, as AI-driven demand for computing power provides Amazon with unprecedented momentum.
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Key AWS performance metrics:
– Revenue growth: 20% to $33.0 billion
– Operating income rose to $11.4 billion
– Maintains over 31% market share in global cloud infrastructure
Substantial AI Investments Yield Returns
While competitors are still formulating their AI strategies, Amazon is already realizing substantial returns from its investments. The company’s Trainium2 chips have evolved into a multi-billion dollar enterprise, recording an astonishing 150% quarterly growth rate. Amazon has further solidified its AI leadership through Project Rainier, an $11 billion data center initiative equipped with 500,000 Trainium2 chips.
Looking forward, Amazon’s guidance for the holiday quarter projects revenue growth between 10-13%, suggesting the technology giant may be positioned to extend its current renaissance through the year’s most crucial shopping period.
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