Amazon AI Boom: Analysts See AWS, AI Agents Driving Bigger Growth

Amazon.com Inc. (NASDAQ:AMZN) is expanding AI across its cloud, e-commerce, advertising and Prime businesses, while analysts increasingly view agent-driven commerce as a potential growth opportunity rather than a threat to its model. The stock rose more than 1% Wednesday, supported by bullish analyst commentary, growing AI-related cloud revenue and broader strength in technology stocks. • Amazon.com stock is gaining positive traction. Why is AMZN stock trading higher? Amazon Analyst Outlook Amazon carries a Buy consensus rating with an average price forecast of $335. Recent analyst actions remain bullish: Tigress Financial Partners raised its forecast to $385 while maintaining Buy on Oct. 6, TD Cowen reiterated Buy with a $350 forecast on Oct. 5, and Rosenblatt lifted its forecast to $360 while maintaining Buy on Sept. 30. Rosenblatt Sees AI Agents as an Opportunity Rosenblatt analyst Scott Devitt rejected the view that AI agents will materially threaten Amazon’s economics. He told CNBC last Thursday that Amazon can adapt its advertising model as shopping becomes more agent-driven, potentially shifting from cost-per-click advertising toward cost-per-action pricing. That structure could allow Amazon to monetize transactions even when AI agents play a larger role in completing purchases. Devitt also expects AI agents to reduce shopping friction and accelerate e-commerce growth. He believes Amazon can protect its marketplace take rate through advertising, transaction fees, fulfillment, logistics and storage. Tigress Sees AI Flywheel Driving Returns Tigress Financial Partners analyst Ivan Feinseth remains even more bullish. Feinseth said Amazon’s integrated AI flywheel is accelerating AWS and AI growth, increasing advertising revenue, driving more frequent purchases and strengthening Prime engagement. He also sees Amazon approaching an important financial inflection point as earnings from its heavy investment cycle begin growing faster than operating capital. Tigress views AWS and AI as Amazon’s strongest growth engine and competitive moat. Feinseth also expects agentic commerce to push Amazon beyond a traditional online retailer toward an AI-powered purchasing platform. TD Cowen Sees Demand Outrunning Capacity TD Cowen analyst John Blackledge also remains constructive on AWS. He highlighted five consecutive quarters of accelerating AWS revenue growth and said Amazon’s AI business exited the second quarter at roughly a $25 billion annual run rate. Blackledge also pointed to CEO Andy Jassy’s view that AWS could eventually generate $1 trillion in revenue. Amazon expects AWS to remain capacity constrained through 2026 and 2027 as AI demand grows, even as the company plans to double capacity by the end of 2027. Blackledge said demand already visible for 2028 led TD Cowen to materially raise its five-year AWS revenue and operating income forecasts, reinforcing the view that Amazon’s AI spending is increasingly tied to identifiable future demand and monetization opportunities. See More: Top Value Stocks AWS Executives Defend AI Spending AWS Chief AI and Technology Officer Matt Wood said Amazon wants to reduce the cost and complexity of AI in the same way cloud computing simplified website development. Wood defended AWS’s $220 billion infrastructure investment, citing customer demand and internal business metrics. He said the cost of delivering a given level of AI intelligence outside frontier models is falling by one or two orders of magnitude every three to six months. Wood expects those efficiency gains to broaden AI adoption and help hyperscalers monetize their infrastructure investments. Top ETF Exposure First Trust Dow Jones Internet Index Fund (NYSE:FDN): 9.78% Weight MicroSectors FANG+ 3x Leveraged ETN (NYSE:FNGU): 9.76% Weight MicroSectors FANG+ ETNs (NYSE:FNGS): 9.76% Weight Significance: Because Amazon carries such a heavy weight in these funds, any significant inflows or outflows for these ETFs will likely trigger automatic buying or selling of the stock. AMZN Price Action Amazon shares were up 1.05% at $258.98 at the time of publication on Wednesday, according to Benzinga Pro data. Photo: Shutterstock Read Also: High-Beta AI Play: Cerity Partners' Jim Lebenthal Views Oracle Pullback as Buying Opportunity