From Nasdaq.: 2024-07-12 04:37:00

Amazon recently joined the $2 trillion club, with potential for further market cap growth. The company offers exposure to e-commerce, AI, and cloud computing. Investors wonder if Amazon can reach a $3 trillion market cap soon.

Amazon’s stock would need to surge by 50% to hit $3 trillion, presenting a challenge despite potential catalysts like AI investments. The company’s AI endeavors, including chatbots and Alexa features, could drive growth with the expansion of its Amazon Web Services segment.

Amazon needs to boost its growth rate to sustain its stock rally in 2024. While first-quarter sales showed a 13% increase, more acceleration is required, especially in AI-related demand. Second-quarter results may provide insight into the company’s performance and set the stage for outsize gains.

While a $3 trillion market cap for Amazon is likely in the future, it might not happen this year due to the seismic growth required. Despite generating over $140 billion in quarterly revenue, significant growth is needed. Amazon remains a strong long-term investment even if it doesn’t hit the target this year.

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Please note that the author’s views do not reflect those of Nasdaq, Inc. John Mackey, former CEO of Whole Foods Market, sits on The Motley Fool’s board of directors. The Motley Fool has positions in and recommends Amazon and Nvidia.



Read more at Nasdaq.: Amazon Hits a $2 Trillion Market Cap. Can It Reach $3 Trillion by the End of the Year?