Analysts Maintain Buy Ratings on Amazon Despite Mixed Guidance

Amazon reported strong second-quarter earnings with revenue of $167.7 billion and earnings per share of $1.68, exceeding analyst expectations. However, its third-quarter operating income guidance disappointed investors, causing an 8% drop in premarket trading, although analysts remained bullish on the stock's long-term potential. Major Wall Street firms including Goldman Sachs, JPMorgan, Morgan Stanley, Bank of America, and RBC Capital reiterated Buy ratings and raised price targets, ranging from $240 to $300 per share, citing solid retail growth, improved cost efficiency, and accelerating advertising and AWS revenue. Analysts highlighted Amazon's investments in generative AI, robotics, and automation as significant future growth drivers. Despite some challenges in AWS such as capacity constraints, the segment's revenue growth and expected acceleration due to AI cloud market opportunities underpin positive outlooks. Overall, the consensus reflects confidence in Amazon’s ability to compound revenue growth and expand operating margins over the coming years.