From Nasdaq: 2025-06-03 10:46:00

Amazon’s stock performance in 2025 disappoints investors with a 5.8% decline despite strong first-quarter results, including $155.7 billion in revenue and net income of $17.1 billion. Operating income of $18.4 billion exceeded expectations, but free cash flow dropped to $25.9 billion due to increased capital expenditures of $87.9 billion.

Amazon Web Services (AWS) maintains growth momentum with 17% year-over-year growth, reaching $29.3 billion in quarterly revenue and a $117 billion annualized run rate. Scalability and pricing power drive AWS operating margins to 39.5%, with backlog at $189 billion. Supply constraints limit capacity deployment for AI-driven demand.

Amazon’s AI innovations, including the new Amazon Q Developer experience and Claude 4 models through Amazon Bedrock, enhance customer experiences and operational efficiency. Competition in agentic AI intensifies, with advancements from Microsoft, Nvidia, and Google. Amazon faces operational challenges and tariff uncertainties impacting short-term performance.

Investors face a decision on holding or waiting on Amazon stock. Despite underperforming year-to-date, Amazon’s fundamental strength supports a holding strategy for current investors. New investors may benefit from waiting for better entry points in the second half of 2025. Strong operational performance and strategic AI initiatives make Amazon an attractive long-term investment.



Read more at Nasdaq: Should You Hold on to AMZN Stock in 2H25 Despite its 5.8% YTD Decline?