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Best AV Receiver for 2025

Best AV Receiver for 2025

Yahoo10-03-2025
If you're serious about bringing theater-like sound into your home, then an AV receiver is the best choice. It gives you much more control over how you set up and use your home theater system. It acts as a video switch between components like a streaming box or gaming console, and it decodes and amplifies audio signals so you can hear them through your speakers. The best receivers offer excellent sound quality and come equipped with 8K video, Dolby Atmos and music streaming capabilities, and they connect to your TV via HDMI cable. You can start with as little as a pair of stereo speakers and add new speakers and a subwoofer as your budget allows to get the best movie, video game, TV show or music experience.
We've tested many of the big-name brands in sound, including Denon, Sony, Yamaha and more, to discover which deliver the best sound. With more than 20 years of home entertainment experience, I've personally had hands-on time with each of the models included on this list and reviewed them based on price, features, sound quality and performance. I'll update the list as more products are released in 2025.
The Onkyo TX-NR6100 is our top choice because it's an excellent sounding speaker with an array of features. The TX-NR6100 is a 7 x 100-watt-per-channel receiver with Dolby Atmos support and DTS:X audio formats to support premium streaming of TV shows, movies and music. The latest video standards, namely 8K and 4K/120Hz, support the advanced gaming features found on the Xbox Series X and Sony PlayStation 5 consoles.
It includes six HDMI inputs at the back, with three able to pass 8K video; the remaining three ports include HDR10 and Dolby Vision compatibility. There is a Zone 2 HDMI output as well. Other connections include five analog audio inputs, two digital audio inputs (optical and coaxial) and two USB ports. Vinyl is still in the middle of a revival and the NR6100 enables users to take advantage thanks to a dedicated phono input for turntables and record players which lack an onboard phono preamp.
Streaming options include Google Cast, DTS Play-Fi, Spotify Connect, Sonos, AirPlay and Bluetooth. Being able to ask your Google Nest mini for a song and have it play automatically on your AV system is an excellent time-saver. If you have an Alexa household, it will control the Onkyo, too.
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Onkyo's TX-RZ50 is a perfect step-up model for those looking to upgrade their home theater systems for a set of better-quality speakers or to add a turntable. Like its budget-oriented label mate, the TX-NR6100, it's stacked with features including the audiophile-level calibration called Dirac Live, as well as the best streaming suite offered in an AV receiver. On that point, being able to request songs directly from Google Assistant or Amazon Alexa is a real boon.
What improvements does the $1,000 TX-RZ50 offer over the $800 TX-NR6100? Firstly, it offers double the number of 8K compatible inputs (six versus three) plus it boasts more power (120 watts versus 100 watts). It also has two-way Bluetooth for streaming as well as listening on wireless headphones.
The TX-RZ50's performance was excellent whether listening to streamed music or watching a movie: I hadn't heard Dolby Atmos sound this convincing in a long time. The addition of Dirac Live adds its own complexities in setup -- please, only use the Onkyo Controller mobile app in combination with the supplied microphone -- but doing so rewards with a highly involving performance.
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I'm a big fan of the Yamaha RX-V6A, so I was curious to see what the step-up RX-A4A brings to the table. As it turns out, this Yamaha offers even better build quality and a huge, cinematic sound.
Look through the fancy top grille and you'll see neatly packed components and a distinguished, stamped transformer. The system is capable of a beefy 110 watts per channel (stereo) and has seven HDMI ports for your connectivity needs.
I tested the Yamaha A4A against the Onkyo RZ50 and the Denon X3700. The Yamaha's sound quality tended toward the cinematic rather than the musical, and it offered a big, roomy sound perfect for blockbusters or conspiracy thriller TV shows. What was surprising is that the onboard phono preamp was even better than the one on the rival Onkyo RZ50, so I can recommend the Yamaha for people who don't want a separate preamp for their turntable.
The Yamaha is great as a home theater receiver but doesn't sound as good with music streaming. Still, as the Onkyo offers balanced performance across both, it's my current favorite.
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If you're a gamer, this receiver will be able to keep up with the latest games and consoles like the Xbox Series X and the PlayStation 5. The Sony STR-AN1000 is a 7.2-channel Dolby Atmos receiver that offers a whole host of new features, including HDMI 2.1 (4K/120Hz) support and Sony's own 360 Reality Audio. It boasts superb connectivity with six HDMI inputs (two with 8K compatibility) and two 8K outputs. The receiver also includes support for video standards such as Dolby Vision, HDR10 and HLG for high-resolution gaming. As far as analog inputs, the Sony offers four, though it does lack a dedicated phono input.
The Sony also has one of the most sophisticated setup routines yet, so dialing in great sound is even easier. It offers an upgraded version of its calibration routine, now called Digital Cinema Auto Calibration IX. This involves a new stereo microphone and a natty plastic stand -- where competitors' are cardboard -- and it now accommodates multiple seating positions. If you prefer to do a manual AV receiver calibration, then the system is quite powerful, as it now lets you set the height of the screen and speakers; most receivers do not let you do this. But the main reason to buy it is its outstanding performance, especially for video games.
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If you're spending under $1,000, there are four main receivers to choose from -- the Sony STR-AN1000, the Yamaha RX-V6A, the Onkyo TX-NR6100 and the Denon AVR-970H. All offer excellent performance, so the short answer about which to buy is whichever is available for the lowest price. At the moment, that is either the Denon or the Onkyo, which are both on sale for under $600 as I type this. I especially recommend the Onkyo TX-NR6100 for its combination of excellent performance and connectivity. The Onkyo offers easy setup, excellent usability, solid looks and useful features, including the best streaming suite alongside Sony. As an added plus, the Onkyo was never prone to the 4K issue that plagued early versions of the Yamaha RX-V6A.
Meanwhile, the step-up Onkyo TX-RZ50 is an excellent receiver if you're looking for the next level of features and a performance bump over sub-$1,000 models. It offers an excellent, if slightly scary, calibration routine from Dirac Live and the best number of streaming features on the market. It sounds great with music and movies alike.
Lastly, if it's home theater thrills you're after, the Yamaha RX-A4A offers crisp, dynamic sound and fantastic build quality for $1,300.
AV receivers are notoriously complex, with reams of features and confusing technical specifications. (For example, what's 4K/120Hz anyway?) Yet, what are the things that really matter when buying a new model? I'm going to sum up the most important ones right here.
With most TVs and set-top boxes supporting HDMI, you should buy a receiver that has as many of these HDMI input ports and outputs as possible. Front-mounted HDMI ports are kind of like a human appendix -- unneeded, because most users don't hot-plug HDMI devices -- making the number of rear inputs what's most important. (How else are you going to connect your Roku, Blu-ray player, Nintendo Switch and all your other devices?) The Onkyo TX-NR6100 and Denon AVR-S970H have six rear-mounted HDMI inputs, while the Yamaha RX-V6A goes one better with seven. If you want to connect two different displays -- a TV and a projector, for example -- all but the Yamaha offer a second HDMI output. You should also be sure you have an extra HDMI cable or two on hand -- these things are like the second sock of a pair as you can never find them when you need them.
Most receivers in the $500-and-above price range include Dolby Atmos capability and DTS:X, but the effect these formats have on your home theater movie-watching can be subtle, or in most movies, nonexistent. In other words, don't worry about missing out on these formats by not installing a ceiling-pointing speaker or two. Mounting your rear surround speakers high on the wall will get you halfway there in terms of quality, immersive sound.
Most midrange receivers have onboard Wi-Fi network connectivity for wireless music streaming via your speaker system. There are plenty of standards for wireless streaming services, but the most universal are Spotify Connect, Apple AirPlay and Google Cast. If you're looking to build a multiroom system with a variety of AV systems and speakers with wireless connectivity, these are the three flavors to aim for. Onkyo and Sony are the only devices to support all three. The Denon receiver model lacks wireless streaming via Google but ups the ante to AirPlay 2 and the proprietary HEOS system. Meanwhile, Yamaha has its own MusicCast system.
At CNET, I test audio equipment from compact soundbars to surround sound systems, but regardless of the device, my methodology is the same. I always compare products against one or more reference devices that offer the best performance at a similar price.
When it comes to receivers I want to see how well a system performs with music and movies, as most people will want to do both. I watch test scenes from 4K Blu-ray or streamed from a 4K streaming service (Fandango at Home, for example) and evaluate aspects such as Dolby Atmos surround sound performance and dialog clarity. I also use several test music tracks and test streaming features such as Bluetooth and Wi-Fi. Systems that can perform well with both types of entertainment inevitably score the highest.
Check out CNET's receiver buying guide for more about the features and things you should consider when looking for a new system.
Denon AVR-A10H ($4,699): If you hear the words "home theater" and think "dedicated room with a screen and leather recliners" then the AVR-A10H is the kind of receiver you would use to would power it. It has all of the features you need including Dolby Atmos, music streaming, 4K/120Hz on all seven HDMI inputs and more. Yet, while it does sound good (I tested it powering a set of Klipsch Fortes), the Denon's 13 powered channels (@ 150W/Ch) are overkill for most living rooms.
Yamaha RX-V6A ($750): This Yamaha RX-V6A offers a fresh look at AV receiver design, with its futuristic edges and simple controls, while maximizing sound quality. The Yamaha might even make you forget about visiting a cinema ever again, and it's no slouch with music, either. It offers plenty of connectivity with Wi-Fi bringing AirPlay 2, Spotify Connect, Bluetooth and Yamaha's MusicCast system for streaming from your devices. Notably, the TSR-700 is identical, and it was an exclusive model for some outlets. Find out more in CNET's Yamaha RX-V6A review.
($1,699) Denon has a reputation for quality sound and powerful amplification, and the AVR-X3800 will be able to power most systems with ease. In terms of features, the Denon has everything you need in a modern receiver including Dolby Atmos and six 8K HDMI inputs. Based on my head-to-head testing, I found that the Denon was even-handed with movies and music, but not as good as the equivalent Marantz SR6015 with music or as good at home theater as my current pick, the Onkyo RZ50. Read CNET's first take on the Denon AVR-X3800.
A stereo receiver is an audio-only, two-channel amplifier that includes source switching and an AM/FM tuner -- if it lacks a tuner it's called an integrated amp. Meanwhile, an AV receiver is typically a surround sound system amplifier that enables HDMI switching and playback of audio and video. Most also include tuners onboard as well. An AV receiver is more versatile than a two-channel model because it can be used for both stereo and surround sound. You can add as many speakers to them as you have, starting at just two -- so they're pretty flexible to build out your surround sound system.
Standards change all the time, but the bare minimum right now is support for HDR and Dolby Vision, and at least HDMI version 2.0 or better. All of the models above support not only 4K and HDR video but 8K support as well, even if 8K content is hard to find.
Be aware that all 2020 8K-compatible receivers were prone to a bug preventing them from displaying variable refresh rate video, and from the Xbox Series X in particular. Denon, Marantz and Yamaha announced fixes for existing models, while compliant models from Yamaha RX-V6A began shipping in the summer of 2021. Denon and Marantz receivers sold after April 2021 should be 4K/120Hz compatible. Yamaha users can check for 4K compatibility here while Denon and Marantz users should check with their dealer.
The TX-NR6100 is the first receiver I tested that I found to both pass 4K/120Hz and which I would also recommend to new buyers.
If you have a relatively new TV you should be able to use a single cable -- an HDMI cable, to be exact -- to connect your receiver to your television. If you have an HDMI port labeled ARC/eARC on the TV you can connect that to the main HDMI ARC output of the receiver. Doing so enables you to hear onboard Netflix from your TV when you set the receiver on the "TV" input, while also enabling video to be transmitted from your other AV sources.
If you have an older TV without an ARC-compliant port you will need to connect both an HDMI cable and an optical cable to the back of your TV. However, if you have a CRT or rear-projection TV which has composite or component inputs you will need a $1,000-plus receiver such as the Marantz SR6015 or Onkyo TX-RZ50. Many receivers no longer offer switching for these legacy connections.
The short answer is: Yes, but only if you own an Xbox Series X and a brand-new TV. As I write this, there is a growing number of Xbox Series X games that support this optional mode -- including Halo Infinite and Fortnite, to name a couple -- but the advantages of 4K/120Hz over 60Hz are minimal as far as I've seen at this point. Future games and even video sources may make the differences clearer, and that's why you may want a receiver that's fully compatible.
If you do buy an older receiver, you don't care about the Xbox Series X, you can always hook a fancy new console directly to the TV, then use eARC to get audio to the receiver.
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Design and portability Over-ear headphones take a bit more effort to carry around than a simple earbuds case you can stick in your pocket, so it's worth thinking about the design that best suits your travel habits. Most of our top picks have a convenient folding design that lets the ear cups lay flat around your neck when you're not wearing them, while also making it easy to fold them up and throw in the included storage case (or right in your bag if you're short on space). Out of our favorites, Beats Studio Pro take up the least space thanks to their ultra-compact case, though we think the latest Sony headphones come with a superior overall case that sports an ultra secure magnetic flap. The AirPods Max are far more rigid by comparison, with non-folding ear cups and a barely-protective case that leaves the headband exposed. If you're going with Apple's over-ear headphones, we strongly recommend getting a good AirPods Max case to go with them. Extra features Most modern over-ear headphones sound great and offer good noise cancellation, but what about the little things? If you want the option to use a wired connection for better sound and minimal interference, models like the Sony WH-1000XM6, Beats Studio Pro and EarFun Wave Pro have built-in headphone jacks that make that easy. The AirPods Max support wired audio via USB-C, though you'll have to pick up a USB-C to 3.5mm adapter if you want to use them with your computer or music player's headphone port. Also worth considering is how customizable each set of headphones are. The AirPods Max technically have equalizer settings that you can find in your iPhone's accessibility menu, but what you hear out of the box is more or less what you get. The Beats Studio Pro gain a few audio settings when you use them in wired USB-C mode, but they're pretty limited. If you want the ability to fine-tune every frequency to your liking, than you're probably best off with the likes of Sony, Bose or EarFun. Related article The best on-ear headphones in 2025, tried and testedBose QuietComfort Ultra Bluetooth Headphones The Bose QuietComfort Ultra offer rich, highly customizable active noise cancellation complete with a new Immersive Audio feature for engaging 3D sound. Read our review You could easily make a case for the Bose QuietComfort Ultra being not only the best noise-cancelling headphones but the best overall headphones you can buy right now. Their ANC capabilities continue to be some of the best in the business, able to silence even the most chaotic environments complete with 10 levels of noise cancellation that you can save to custom profiles for those times you need a lot (or a little) help blocking out the outside world. They also sound excellent, with a new Immersive Audio mode that we've found to deliver some of the most engrossing 3D sound of any high-end headphones. So, why didn't they make the top of our list? Sony's headphones are just ever so slightly better. We found the WH-1000XM6 to offer a bit more noise suppression in most environments and generally prefer the way Sony's headphones sound too. The XM6 have a better case and are also rated for 10 more hours of battery life than what you'll get out of the QuietComfort Ultra. That said, you truly can't go wrong with either of those two top dogs, and the QuietComfort Ultra are an especially great buy if you're a fan of spatial audio and want extra-fine control over your headphones' noise cancellation. EarFun Tune Pro Over-Ear Headphones The EarFun Tune Pro offer multiple ANC modes, a robust feature set for iOS and Android users, and up to 120 hours of battery life. 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They are still a great pair of headphones that you can often score for less than 60 bucks, but the Wave Pro is the more compelling value. Sony WH-1000XM5 Over-Ear Headphones The Sony WH-1000XM5 offer class-leading sound alongside adaptive active noise cancellation and up to 40 hours of battery life. Read our review The Sony WH-1000XM5 enjoyed a long reign as our best over-ear headphone pick, and their stellar sound, comfortable design and long battery life still hold up today. They're also significantly cheaper than the new XM6 model, with sales dropping the XM5 to as low as $250 to $300. We think the XM6's refined, folding design and even better audio makes them the better pick for first-time buyers who don't mind splurging, but the XM5s are a great alternative at their current price. Apple AirPods Max With USB-C The AirPods Max are a good splurge option for Apple users and recently got updated with USB-C charging and some fresh new our review Our former top pick for Apple users, the AirPods Max still deliver superb sound, immersive spatial audio and effortless integration with all of your Apple products. Better yet, Apple recently refreshed them with USB-C charging and a new wave of colors: black (Midnight), blue, purple and remain a great splurge option for those who want supreme style and performance, granted the newer Beats Studio Pro offer many of the same features for a fraction of the price. Bowers & Wilkins Px7 S2 Over-Ear Headphones These popular high-end headphones offer excellent sound quality and up to 30 hours of battery life within a slick design. Read our review Our former top audiophile pick, this midrange update to the Bowers & Wilkins flagship should appeal to folks who value great sound quality above all else. They're an investment, though a recent price drop makes them a much better value these days. 1MORE SonoFlow Active Noise-Canceling Headphones Our former budget pick, the SonoFlow remain a great bargain with especially strong battery life for the price. Read our review The 1More SonoFlow's excellent audio quality and ANC for the price — not to mention a strong 50 hours a battery life — earned these over-ear headphones a top spot as our favorite budget headphones for quite a while. They're still a good bargain today, though their build quality and controls are underwhelming, and the EarFun Wave Pro get you a better overall feature set for your money. Sony Ult Wear Headphones The Sony Ult Wear offer most of Sony's flagship headphone features (and an extra helping of bass) for a nice sub-$200 price. Read our review The Sony Ult Wear are a great affordable alternative to our top pick in the Sony WH-1000XM6, especially if you're a bass lover. On top of offering up to 50 hours of battery life and many of the same high-end perks of Sony's flagship headphones, the Ult Wear pack a special 'Ult' button that kicks the low end into overdrive and adds even more oomph to your favorite bass-heavy tracks. The Ult Wear's overall build quality, noise cancellation and call quality leave something to be desired, but these are well worth considering if you want premium sound for less than $200. Sonos Ace Wireless Over-Ear Headphones Sonos' first-ever headphones live up to the brand's reputation for great audio quality and cross-device compatibility. Read our review Sonos headphone debut is a massive winner, with great sound quality and reliable noise cancellation packed into one of the nicest designs we've rocked on our heads. They're an especially great pickup for those in the Sonos ecosystem, as you can switch audio between the Ace and your Sonos soundbar with a single button press; perfect for when you're transitioning from home to the couch. However, their just-okay battery life, buggy app and high price make them best suited for Sonos enthusiasts for now. Bose QuietComfort Headphones The latest version of these beloved headphones offer some of the best ANC around, alongside up to 24 hours of battery and a range of enticing color options. The latest refresh of Bose's signature QuietComfort 45 headphones offer better battery life, multipoint support for pairing to two devices at once and the company's typically great ANC. This rehash of the QuietComfort 45 retains its predecessor's minimalist skin and welcomes a handful of upgrades. They're a good pick for the price, though we'd recommend splurging on the Bose QC Ultra or Sony XM6 for their superior sound if you can. Bowers & Wilkins Px8 Over-Ear Wireless Headphones These high-end audiophile headphones offer superb sound quality and one of the most comfortable designs we've tried. The high-end sibling of the Px7 S2, the leather-clad Px8 are a decidedly luxe take on the same concept as its younger (and less expensive) sibling. They're a little better all around — nicer materials, exotic drivers with carbon-fiber cones and bigger magnets, as well as marginally better sound than the already great-sounding Px7 S2 — but otherwise have the same features and are very similar under the hood. As such, we think the Px7 S2 (or our top audiophile pick in the Cambridge P100) makes more sense. Edifier Stax Spirit S3 Wireless Planar Magnetic Headphones These headphones feature unique magnetic drivers that we've found to offer excellent audio quality in our testing. The Edifier Stax Spirit S3 do sound really well — plenty of high-end detail and dynamics, and good imaging with an airy sense of space, which is impressive for fairly small closed-back headphones — making them a solid choice if your tastes run toward acoustic music. An app lets you make some EQ adjustments, though you're limited to a handful of presets; it'd be nice to see a little more of an open approach here. Sound aside, the Stax Spirit S3 offer impressive Bluetooth range, fold up small for travel and include a cool travel case. You can even use the Stax Spirit S3 wired (though you still need to turn them on, so this is more for use with non-wireless devices than a fallback for being out of power). There's no ANC here, so you'll depend on the closed-back design and good seal for isolation. Poly Plantronics BackBeat Pro 2 Headphones These popular noise-canceling headphones stand out with a retro-inspired design and unique rotary controls. The Poly Plantronics BackBeats Pro 2 have decent overall sound quality but lack bass extension and don't produce a wide-sounding soundstage. Call quality was relatively poor, with one recipient describing it as sounding like we were underwater. But they are comfortable to wear, and they have a fun-to-use rotary volume control. Sennheiser Consumer Audio Momentum 4 Wireless Headphones The Sennheiser Momentum 4 offer a strong overall experience out of the box, from sound quality and ANC to long-term comfort. Read our review The updated Sennheiser Momentum 4 drop the retro styling of their predecessors for a more vanilla look, but improved ANC, a solid app and great sound make them a compelling choice for headphones aficionados. Skullcandy Crusher ANC Over-Ear Headphones Despite their intriguing bass boost functionality and useful app, the Skullcandy Crusher ANC are an easy skip for most. The Skullcandy Crusher ANC were our least favorite in our testing pool. A dedicated bass-boost slider on one of the ear cups lets you go from a thin bass response to skull-rattling boom, but it felt like a gimmick, adding clutter to the mix but not definition. Using the Skullcandy app gave us access to some better-sounding custom profiles, but given that the Crusher weren't especially comfortable to wear, we'd look at one of our other recommendations at this price. Sony WH-1000XM4 Over-Ear Headphones This older version of our top pick remains a great pair of all-around headphones, especially if you can find them on sale. The Sony WH-1000XM4 are an all-time favorite, and still a fantastic pickup today if you can snag them on sale. The newer XM6 model offers superior sound, ANC and a much-improved carrying case, but if you don't have $450 to blow, the XM4's excellent all-around quality for a fraction of that price. What is the best way to clean over-ear headphones? What is the best way to clean over-ear headphones? According to representatives from JBL and Urbanista we spoke to, you should give your headphones a quick wipe down at least once a week — and more often if you're using them to work out. A quick disinfectant wipe or damp cloth will do the trick most of the time; just be careful not to apply excess moisture to your headphones. For a deeper clean, you should remove your ear cups, wipe them down with a cleaning wipe or a microfiber cloth with a small amount of isopropyl alcohol applied to it, and either dry them with a soft cloth or let them air-dry. You can also take this time to use a cleaning brush to dig dirt out of those nooks and crannies you might not notice with your ear cups attached. Of course, how to clean your headphones also depends on the materials. You might be fine cleaning a leather or faux-leather set of ear cups with a wet cloth after workouts, but you'll want to stick to something dry when wiping down fabric models like the AirPods Max. When in doubt? Check your headphones' user manual, as the last thing you want to do is accidentally void your warranty. Do wired over-ear headphones have better sound quality than wireless on-ear headphones? Do wired over-ear headphones have better sound quality than wireless on-ear headphones? It depends. The big advantage of wired headphones is the lack of latency and interference, since they don't depend on a Bluetooth connection to bring you your tunes. In some cases, this can also mean better audio quality. For example, the wireless Beats Studio Pro offer lossless audio when you use them over a wired USB-C connection, which means you'll enjoy higher-fidelity tracks that aren't compressed for easy Bluetooth streaming. However, there are plenty of other factors that dictate sound quality, including the actual quality of your headphones themselves, the audio settings you're using and whether or not you have active noise cancellation turned on. Those with a discerning ear may notice a slight difference between wired and wireless versions of the same model, but we think wireless headphones are more than clear enough for the average listener. Can you run with over-ear headphones? Can you run with over-ear headphones? While we strongly recommend running with a great pair of workout earbuds rather than over-ear headphones for comfort and safety reasons, you can get away with using over-ear headphones under the right conditions. If you plan on using headphones for running, you should find something light that features leather or faux-leather ear cups, as these are much easier to clean sweat from than the kinds of fabric ear cups you'll find on, say, the AirPods Max. You'll also want to make sure your headphones feature some sort of ambient noise or transparency mode, so you can stay aware of your surroundings while you run. That said, most over-ear headphones lack an IP rating for water and sweat protection, so you'd be much better off with some of the best true wireless earbuds or an open-ear model like the Shokz OpenFit Air. CNN Underscored's writers and editors thoroughly test the products in our testing guides and provide full transparency about how we test them. We have a skilled team with many years of product testing experience and ensure each article is carefully edited and products are properly vetted. We talk to subject matter experts where applicable to make certain we test each product accurately and can speak about the pros and cons of each. Senior tech editor Mike Andronico has tested more headphones and earbuds than he can count in his decade-plus career doing product reviews of consumer tech, and he is always in search of the next great pair that can dethrone his AirPods Pro.

AI Daily: Amazon down after AWS growth didn't accelerate like peers
AI Daily: Amazon down after AWS growth didn't accelerate like peers

Business Insider

time7 hours ago

  • Business Insider

AI Daily: Amazon down after AWS growth didn't accelerate like peers

Catch up on the top artificial intelligence news and commentary by Wall Street analysts on publicly traded companies in the space with this daily recap compiled by The Fly: Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. AMAZON: Amazon (AMZN) reported Q2 EPS of $1.68 and Q2 revenue $167.7B, both above consensus of $1.33 and $162.11B, respectively. Andy Jassy, President and CEO of Amazon, said 'Our conviction that AI will change every customer experience is starting to play out as we've expanded Alexa+ to millions of customers, continue to see our shopping agent used by many millions of customers, launched AI models like DeepFleet that optimize productivity paths for our 1M+ robots, made it much easier for software developers to write code with Kiro (our new agentic IDE), launched Strands to make it easier to build AI agents, and released Bedrock AgentCore to enable agents to be operated securely and scalably. Our AI progress across the board continues to improve our customer experiences, speed of innovation, operational efficiency, and business growth, and I'm excited for what lies ahead.' Despite beating on the top and bottom lines in Q2 and offering a better-than-expected Q3 revenue outlook of $174B-$179.5B, the stock underperformed, which analyst said could be related to the company's guidance for operating income of $15.5B-$20.5B for Q3, which was worse at the midpoint than the expected $19.5B. Following the report, RBC Capital raised the firm's price target on to $240 from $230 and keeps an Outperform rating on the shares. The company had a mixed print and an even tougher conference call, the analyst tells investors in a research note. Positively, the retail business is firing on most if not all cylinders, but at AWS, growth didn't really accelerate like peers, margins missed and management's commentary on the call did little to attenuate investor fears that AWS may have a bigger structural issue in capturing its fair share of the growth from AI, RBC added. In its own post-earnings note, Stifel lowered the firm's price target on Amazon to $260 from $262 and keeps a Buy rating on the shares. Corporate-level Q2 results were 'very healthy,' with revenue and operating income both above the high-end of the guided range, while Q3 guidance was 'mixed,' with revenue ahead of expectations and lighter-than-expected operating income, the analyst tells investors. However, stable revenue growth at AWS was a disappointment after heightened expectations heading into the print with Microsoft's (MSFT) Azure and Google's (GOOGL) GCP both posting about 400 basis points of acceleration this past quarter, the analyst added. JASSY SAYS: Jassy said, 'Automation and robotics are also important contributors to improving cost efficiencies and driving better customer experiences over time. We deployed our one millionth robot across our global fulfillment network and unveiled innovations at our last mile innovation center, such as automated package sorting and a transfer transformative technology that brings packages directly… We rolled out Deepfleet our AI moves robot travel efficiency by 10% At our scale, that's a big deal. Deepfleet acts like a traffic management system to coordinate robots' movements to find optimal paths and reduce bottlenecks. For customers, it means faster delivery times and lower costs. For our team members, our robots handle more of the physically demanding tasks making our operations network even safer. This combination of robotics and generative AI is just getting started, And while we've made significant progress, it's still early respect to what we'll roll out in the next few years.' CEO Jassy also stated, 'Our custom AI chip Trainium two is landing capacity in larger quantities and has improved impressively emerged as the backbone for Anthropix newest generation cloud models and many of our most essential offerings like Amazon Bedrock. We've also launched Amazon EC two instances powered by NVIDIA Grace Blackwell Superchips AWS's most powerful NVIDIA GPU accelerated instance. Second, in Bedrock, we've recently added Anthropix Cloud four and it's the fastest growing model ever in Bedrock. We've also continued to see strong adoption of Amazon Nova, our own frontier model, and it's now the second most popular foundation model in Bedrock. New features in Nova allow customers to customize their Nova models in ways they can't on other foundation models. Allowing organizations to infuse these models with their unique expertise while optimizing for cost and speed. As people have become excited about building agents, they're realizing they lack the tools to build them. In May, we released strands, an open source way to more easily build agents that's taken off with a wide range of customers already 2,500 stars in GitHub and over 300,000 downloads on PYPI. Customers are also struggling with deploying agents into production in a secure and scalable way. It's holding up enterprises scaling agents. To help solve that problem, Bedrock just released agent core. AgentCore is a set of building blocks that gives customers the industry's first secure serverless runtime to provide both synchronous and asynchronous execution. Agent identity and boundaries, a memory service, a gateway that translates services to MCP compatible interfaces, built in code execution and web browser tools, and an observability service. Customers are excited about Agent Core, and it frees them up to start deploying agents more expansively. Third, you're starting to see AWS release more powerful applications at the top layer of the AI stack.' VAST DATA: Alphabet's (GOOG, GOOGL) growth-stage venture arm CapitalG and Nvidia (NVDA) are in talks to invest in artificial intelligence infrastructure provider Vast Data in a new funding round that could value the startup as high as $30B, two sources said, Reuters' Krystal Hu, Max A. Cherney and Milana Vinn report. The startup is raising several billion dollars from tech giants, private equity and venture capital investors, which could make it one of the most valuable AI startups, the two sources with knowledge of the matter said, as companies building the backbone for the AI boom come into sharper focus. BUY REZOLVE AI: Alliance Global Partners initiated coverage of Rezolve AI (RZLV) with a Buy rating and $8.50 price target. The firm's contacts indicate Rezolve AI's conversational artificial intelligence technology is among the two or three best technologies focused on e-commerce. The company has already signed enough new business to exit the year at a $70M annual revenue run rate, Alliance Global tells investors in a research note. Online retail will benefit from AI and Rezolve is positioned to capitalize on this 'mega trend,' contends the firm.

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