The Bull Case For Amazon.com (AMZN) Could Change Following Landmark $38 Billion Cloud Deal With OpenAI

Amazon.com recently announced strong third-quarter 2025 results, highlighted by a surge in AWS revenue and the signing of a landmark multi-year, US$38 billion cloud services agreement with OpenAI to support advanced AI workloads. This collaboration marks OpenAI's first major cloud partnership outside of Microsoft, underscoring Amazon's strengthening position in artificial intelligence infrastructure and cloud computing. We'll explore how the new OpenAI partnership and AWS growth momentum could reshape Amazon's investment narrative around cloud and AI innovation.

Uncover the next big thing with financially sound penny stocks that balance risk and reward.

Amazon.com Investment Narrative Recap

To own Amazon.com shares, you have to believe the company can translate its scale in e-commerce and technology into leadership in cloud and AI, offsetting regulatory and cost pressures. The landmark US$38 billion multi-year cloud partnership with OpenAI and recent surge in AWS revenue offer a clear short-term growth catalyst, but the demands of rapid innovation and rising capital intensity remain the primary risk to margins and overall earnings. The announcement helps the catalyst, but does not materially erase the risk.

Among announcements, the expanded collaboration between AWS and Verizon to provide resilient, high-capacity infrastructure for AI workloads stands out. This builds on AWS’s momentum by supporting large-scale deployments for clients pursuing advanced AI applications, reinforcing the thesis that Amazon is making meaningful progress capturing the next wave of cloud and AI adoption.

However, increased capital needs and supply constraints tied to supporting these ambitious partnerships are risks investors must not ignore...

Read the full narrative on Amazon.com (it's free!)

Amazon.com's outlook suggests revenues of $905.9 billion and earnings of $111.9 billion by 2028. This is based on an assumed annual revenue growth rate of 10.6% and represents an increase in earnings of $41.3 billion from the current $70.6 billion.

Uncover how Amazon.com's forecasts yield a $287.57 fair value, a 18% upside to its current price.

Exploring Other PerspectivesAMZN Community Fair Values as at Nov 2025

142 fair value estimates from the Simply Wall St Community place Amazon.com’s worth between US$173.76 and US$294.90 per share. With AWS’s growing capital demands and heightened competition, your outlook on future margin resilience may tip your own view on the company’s true value.

Explore 142 other fair value estimates on Amazon.com - why the stock might be worth 29% less than the current price!

Story Continues

Build Your Own Amazon.com Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

A great starting point for your Amazon.com research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision. Our free Amazon.com research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Amazon.com's overall financial health at a glance.

Want Some Alternatives?

Don't miss your shot at the next 10-bagger. Our latest stock picks just dropped:

Trump's oil boom is here - pipelines are primed to profit. Discover the 22 US stocks riding the wave. Rare earth metals are an input to most high-tech devices, military and defence systems and electric vehicles. The global race is on to secure supply of these critical minerals. Beat the pack to uncover the 35 best rare earth metal stocks of the very few that mine this essential strategic resource. Outshine the giants: these 24 early-stage AI stocks could fund your retirement.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include AMZN.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

View Comments