Alphabet increased its annual CapEx target last week, which pressured shares of hyperscalers including Amazon at the time. Microsoft, reporting on Wednesday, maintained its CapEx view.
- Amazon shares have declined for seven sessions straight, losing over 9% in this period.
- Analysts expect Amazon’s Q2 revenue to rise 17% to $196.45 billion, which would be the fastest growth since the first quarter of 2021
- The retail sentiment for AMZN has been climbing up since the start of July and was ‘neutral’ as of early Thursday.
Amazon.com, Inc. (AMZN) is heading into its quarterly report due after hours on Thursday amid a mixed setup. Shares have declined for seven sessions straight, cumulatively losing over 9% in this period. However, analysts remain overwhelmingly optimistic on the company’s business.
Investors will be closely watching growth at its Amazon Web Services unit, which is a proxy for the company’s AI business, and, more importantly, any changes to its capital expenditure targets.
Alphabet increased its 2026 CapEx target last week, which pressured shares of hyperscalers including Amazon at the time. Microsoft, reporting on Wednesday, maintained its CapEx view.
Amazon has projected its 2026 CapEx to be approximately $200 billion, up sharply from about $131 billion in 2025.
AMZN stock was 1.2% higher in early premarket trading on Thursday. The company will report its second-quarter results after the market closes.
Analysts Broadly Bullish Ahead Of AMZN’s Report
Analysts expect Amazon’s second-quarter revenue to rise 17% to $196.45 billion, which would be the fastest growth since the first quarter of 2021, according to consensus estimates from Koyfin. Adjusted profit is seen rising 8% to $1.82 per share.
Earlier this week, UBS lowered its price target on AMZN to $305 from $333 while maintaining a Buy rating on the stock.
The firm cited higher capital expenditure estimates for 2027 and beyond due to rising component prices and demand as a potential drag on the stock.
UBS made near-term changes to its AWS revenue projections, moving OpenAI’s initial use of Trainium out of the fourth quarter of 2026 and into early 2027, which shifts approximately $3 billion of revenue out of this year.
Still, the research firm estimates 36% growth at AWS in the second half compared to the Street’s 31% estimate.
Evercore ISI kept its Outperform rating and $315 price target on Amazon, while BofA Securities reaffirmed a Buy rating and lifted its revenue estimate to $198.8 billion.
Currently, 62 out of 65 analysts rate the stock ‘Buy’ or higher, and the remaining three rate it ‘Hold,’ per Koyfin. Their average price target of $226.65, which implies an upside of 38% upside from the stock’s closing price on Wednesday.
Retail View On AMZN
On Stocktwits, the retail sentiment for AMZN has been climbing up since the start of July and was ‘neutral’ as of early Thursday.
“AMZN I wanna load the boat here…. but if there spending like drunken sailors 205 comes quick real quick,” a trader wrote. Another said, “AMZN $225 hit, nice double bottom with technical divergences. I see green ahead. If earnings are positive we could see a decent move upside to end the week.”
Apple is also scheduled to report its quarterly results after market hours on Thursday.
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