As Amazon prepares to release its quarterly financial results, the technology behemoth is receiving a notable boost from Wall Street analysts. The market’s focus is firmly on the upcoming report, with a key artificial intelligence partnership driving upward revisions in share price targets. This raises a pivotal question: is the growth narrative for its cloud computing division still on track?
Investor Focus Shifts to Thursday’s Report
All eyes are now on Thursday, February 5th, when Amazon will disclose its performance for the fourth quarter of 2025. According to market consensus, revenue is anticipated to reach approximately $211.3 billion, representing a year-over-year increase of roughly 13%. Earnings per share are projected to fall between $1.96 and $1.97. Beyond the headline figures, investors are expected to scrutinize the year-on-year operating margin of Amazon Web Services (AWS) with particular intensity.
Strategic AI Partnership Drives Price Target Increases
A significant catalyst for recent analyst optimism stems from Amazon’s alliance with AI firm Anthropic. Reports indicate that Anthropic has substantially raised its internal revenue forecast, now targeting a minimum of $17 billion for 2026 and aiming for over $46 billion in 2027. Given that AWS serves as the primary cloud infrastructure partner for Anthropic, Amazon stands to benefit directly from this projected expansion.
Should investors sell immediately? Or is it worth buying Amazon?
In response to this development, the investment bank Citizens JMP elevated its price target for Amazon shares from $300 to $315 on Monday, reaffirming its “Market Outperform” rating. Analysts estimate that Anthropic’s projected expenditures on training and inference—expected to surpass $19 billion in 2026 alone—will flow directly into AWS’s revenue streams. Separately, Jefferies also reiterated a buy recommendation with a $300 target, citing the cloud division’s robust order backlog which suggests growth rates in the mid-20 percent range.
Cost-Cutting Measures Underpin Margin Strategy
Concurrently, CEO Andy Jassy continues to enforce a strict focus on profitability. In late January, the company announced plans to eliminate 16,000 positions within its administration, a move designed to streamline management layers and enhance operational agility. The company is also realigning its physical retail footprint, closing Amazon Go and Fresh locations to facilitate the expansion of Whole Foods Market.
Market observers interpret this sustained cost discipline, despite criticism from worker representatives, as a crucial factor in stabilizing corporate margins. Trading at approximately $239.30 with a market capitalization of $2.56 trillion, Amazon’s stock enters this pivotal earnings week with momentum. Whether the company can meet the market’s elevated expectations will become clear after the closing bell on Thursday.
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