Amazon’s advertising business is booming, driving significant growth. AWS is making strides in the AI sector. Gross margins for Amazon have shown a remarkable improvement over the past five years. Despite underperforming in 2025, Amazon’s stock may be gearing up for a rally in 2026 following strong Q3 results.

Amazon’s ad segment saw a 24% revenue increase in Q3, reaching $17.7 billion, exceeding Netflix’s revenue. AWS revenue grew by 20%, showcasing its dominance in cloud computing. The Trainium2 AI chip segment experienced a significant 150% growth quarter over quarter, solidifying Amazon’s position in AI.

With improving margins from high-margin businesses like AWS, Amazon’s gross profit margin is on the rise. This positive trend indicates long-term growth potential. Despite recent underperformance compared to peers, Amazon’s stock presents a promising investment opportunity for the future.

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Read more at NASDAQ MarketSite: 3 Reasons Amazon Is a No-Brainer Buy Right Now