Latest news with #Trainium2
Business Insider
10-07-2025
- Business
- Business Insider
Amazon (AMZN) Asserts Dominant Position in Cloudy AI-Powered Future
Amazon's (AMZN) AWS has demonstrated strong performance recently, with artificial intelligence emerging as a significant growth catalyst for the cloud leader. As AI continues to reshape various industries, AWS is well-positioned to capture incremental market share and revenue from this rapidly evolving sector. Notably, AMZN stock has staged a remarkable bullish recovery since its recent lows in April, rising from around $175 to $220 per share. Don't Miss TipRanks' Half-Year Sale Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week. Additionally, the expansion driven by AI appears to be contributing to margin improvement, enhancing the company's overall profitability. Given these trends, Amazon's valuation remains compelling—even near its historical highs—supporting a continued Bullish outlook for the stock. AWS and Nova Fuel Amazon's AI Growth On Amazon's Q1 earnings call, CEO Andy Jassy couldn't stop raving about AWS's AI momentum, noting that its AI business is growing at triple-digit rates year-over-year. Seeing the progress AWS has made in the recent quarter, I totally get his enthusiasm. While we are still early in the game, it appears that AWS is capturing the lion's share of enterprise demand for AI tools, such as Amazon Nova, which powers areas like automated coding and advanced web analytics. Consider recent deals with heavyweights such as Adobe (ADBE) and Uber (UBER), or the $5 billion partnership with HUMAIN in Saudi Arabia to expand AI infrastructure globally. Why is AWS still such a beast? Much of it comes down to Amazon's custom chips, such as the new Trainium 2, which help reduce the cost of training and running AI models. Jassy called them out recently, and for good reason. That kind of technology gives AWS a significant advantage, including higher speed, lower costs, and significantly more flexibility for customers. And clearly, it's working. AWS pulled in $29.3 billion last quarter (up 17% from last year), and it's sitting on a $189 billion backlog. Microsoft's (MSFT) Azure is definitely pushing hard, but AWS still has the early lead in AI and has now captured about 31% of the cloud market. It's hard to bet against them. Profitability on the Rise: AI's Margin Magic Now, let's talk about why this AI boom is a goldmine for Amazon's bottom line. Beyond contributing to higher revenues, AWS is also significantly boosting margins, according to TipRanks data. In Q1, AWS posted $11.5 billion in operating income with a 39.5% margin, a standout in Amazon's $18.4 billion total operating income, which jumped 20% year-over-year. CFO Brian Olsavsky highlighted smarter software and custom networking gear as key drivers, optimizing server capacity and reducing infrastructure costs, which explains the significant boost in margins. The broader picture is just as exciting. Amazon's high-margin businesses, including AWS and a 19% surge in advertising revenue to $13.92 billion, are reshaping its margin profile and pointing to an increasingly profitable company, despite its still low-margin retail business. All in all, AWS remains the standout revenue driver, according to TipRanks data. There is also strong cross-selling potential here, as many companies running on AWS are likely to want to advertise, so as AWS onboards more clients in the AI era, it is expected to acquire potential advertising partners 'for free', which could prove another long-term margin expansion catalyst. Is AMZN's Valuation Stretched? Investors may be thinking that since AMZN is currently trading near its 52-week highs, the train may have left the station. Not so fast. Yes, at a forward P/E of 35, Amazon's valuation seems steep, but it is actually far from unreasonable when you consider its growth trajectory. Consensus estimates forecast 18% annual EPS growth over the next five years, but I'm convinced Amazon could outpace that, potentially hitting 20-22%. If we look at AMZN's EPS in Q1 2025 ($1.59), it already smashes estimates by 16%, while AWS's AI-driven revenue and margin gains point to more upside. In the chart below, AMZN's revenue is dominated by e-commerce, third-party seller services, and AWS. Therefore, Amazon stock should be able to easily grow into today's forward multiple in the coming years, which, in turn, will sustain the bullish momentum. For context, Microsoft is trading at a heftier 37x this year's expected EPS, despite Wall Street expecting a much softer EPS CAGR of 11% over the next five years. Oracle (ORCL), which also competes heavily with Amazon, trades at an equally rich 34x EPS. While its cloud segment is also performing incredibly well, its legacy database still accounts for a significant portion of the total business, which one could argue should weigh on the valuation at lower levels. What is the Target Price for AMZN Stock? Despite Amazon stock trading very close to its highs, Wall Street maintains a Strong Buy consensus rating. This is based on 45 Buy and one Hold ratings assigned over the past three months. Notably, no analyst has assigned a Sell rating. Today, Amazon stock carries a price target of $246.60 per share, indicating a 12% upside potential over the coming twelve months. AMZN's AWS Angle Ensures Long-Term Investment Case Amazon's AI-driven momentum, led by AWS, shows no signs of slowing. With triple-digit growth in its AI segment, operating margins approaching 40%, and a substantial $189 billion backlog, AWS is reinforcing Amazon's leadership in the cloud space and positioning the company for broader technological influence. While Amazon's forward P/E ratio of 35 may appear elevated, the company's potential to exceed current earnings growth forecasts of 18% could make this valuation appear attractive in hindsight. As AWS continues to scale and drive enhanced profitability, valuation multiples are likely to normalize, further supporting the long-term investment case for AMZN.
Hindustan Times
18-06-2025
- Business
- Hindustan Times
No one's safe- Amazon CEO gives a big 'AI warning' to all employees
Amazon CEO Andy Jassy has delivered a clear and uncompromising message to employees across the company — learn how to work with generative AI, or risk being replaced by it. In a sharply worded post for employees, Jassy laid out Amazon's aggressive push into generative AI and agent-based systems. He called it the 'most transformative technology since the internet' and made it abundantly clear that the wave of automation it's enabling will reshape teams, job functions, and the very structure of the company in the years ahead. 'We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs,' Jassy wrote. He added, 'Educate yourself, attend workshops and take trainings… Those who embrace this change will be well-positioned to help us reinvent the company.' While optimistic about what AI can unlock, Jassy didn't shy away from the uncomfortable reality: many current roles could become redundant as Amazon ramps up its deployment of AI tools across departments. The memo outlines how AI is already deeply embedded in nearly every corner of Amazon's operations. And Jassy made it clear — this isn't an early experiment. It's already working, and the pace is only accelerating. Alexa+: The next-gen voice assistant doesn't just respond — it takes meaningful action on behalf of users. AI Shopping Assistant: Tens of millions of customers now rely on AI to make more informed purchase decisions. Product Discovery Tools: Features like Lens, Recommended Size, and 'Buy for Me' are powered by generative AI. Seller Support: Nearly 500,000 Amazon selling partners are using AI tools to create better listings and grow faster. Advertising: Over 50,000 advertisers used Amazon's AI-powered ad tools in Q1 alone. AWS Services: With innovations like Trainium2 chips, Bedrock, SageMaker, and Amazon's own foundation model Nova, builders can now launch and scale AI applications with ease. Internal Ops: From inventory and forecasting to fulfilment robots and customer service bots, AI is already driving efficiency and reducing costs. Amazon plans to make it much easier to build and deploy AI agents across every business unit — from retail and logistics to cloud and advertising. These agents, Jassy says, will become 'teammates' capable of handling tasks, providing insights, and unlocking faster innovation at scale. But with that comes change. Apple iPhone 16 latest price and deals 'As we go through this transformation together… use and experiment with AI whenever you can,' Jassy urged. 'Those who help us build and improve our AI capabilities… will be well-positioned to have high impact," he added.
CNBC
17-06-2025
- Business
- CNBC
AWS' custom chip strategy is showing results, and cutting into Nvidia's AI dominance
Amazon Web Services is set to announce an update to its Graviton4 chip that includes 600 gigabytes per second of network bandwidth, what the company calls the highest offering in the public cloud. Ali Saidi, a distinguished engineer at AWS, likened the speed to a machine reading 100 music CDs a second. Graviton4, a central processing unit, or CPU, is one of many chip products that come from Amazon's Annapurna Labs in Austin, Texas. The chip is a win for the company's custom strategy and putting it up against traditional semiconductor players like Intel and AMD. But the real battle is with Nvidia in the artificial intelligence infrastructure space. At AWS's re:Invent 2024 conference last December, the company announced Project Rainier – an AI supercomputer built for startup Anthropic. AWS has put $8 billion into backing Anthropic. AWS Senior Director for Customer and Project Engineering Gadi Hutt said Amazon is looking to reduce AI training costs and provide an alternative to Nvidia's expensive graphics processing units, or GPUs. Anthropic's Claude Opus 4 AI model is trained on Trainium2 GPUs, according to AWS, and Project Rainier is powered by over half a million of the chips – an order that would have traditionally gone to Nvidia. Hutt said that while Nvidia's Blackwell is a higher-performing chip than Trainium2, the AWS chip offers better cost performance. "Trainium3 is coming up this year, and it's doubling the performance of Trainium2, and it's going to save energy by an additional 50%," he said. The demand for these chips is already outpacing supply, according to Rami Sinno, director of engineering at AWS' Annapurna Labs. "Our supply is very, very large, but every single service that we build has a customer attached to it," he said. With Graviton4's upgrade on the horizon and Project Rainier's Trainium chips, Amazon is demonstrating its broader ambition to control the entire AI infrastructure stack, from networking to training to inference. And as more major AI models like Claude 4 prove they can train successfully on non-Nvidia hardware, the question isn't whether AWS can compete with the chip giant — it's how much market share it can take. The release schedule for the Graviton4 update will be provided by the end of June, according to an AWS spokesperson.
Yahoo
09-06-2025
- Business
- Yahoo
Amazon.com (NasdaqGS:AMZN) Offers Prime Members Exclusive Early Superman Screenings
allowed Amazon Prime members exclusive access to early screenings of the new Superman movie, potentially boosting its share price by enhancing member engagement. Additionally, Amazon's tech sector advancements, including a $10 billion investment in North Carolina for data centers and the launch of the AWS Asia Pacific region, align with broader market movements, as major indices saw gains amid ongoing US-China trade talks. A 10.62% rise in Amazon's share price over the past month reflects this, in tune with market trends, bolstered by robust tech performance and economic stability. Buy, Hold or Sell View our complete analysis and fair value estimate and you decide. The best AI stocks today may lie beyond giants like Nvidia and Microsoft. Find the next big opportunity with these 25 smaller AI-focused companies with strong growth potential through early-stage innovation in machine learning, automation, and data intelligence that could fund your retirement. The exclusive early screening of the Superman movie for Amazon Prime members is an initiative that could enhance customer loyalty and engagement. This, alongside Amazon's extensive investments in data centers and AWS expansion, aligns with efforts to bolster revenue through heightened member services and tech advancements. Over the past three years, Amazon shares have seen extraordinary growth, posting a total return of 106.01%, which provides a solid context for the company's overall positive trajectory. In terms of short-term performance, Amazon's shares rose 10.62% in the past month, reflecting a positive reception to recent technological developments and strategic moves. This is despite the more moderate 12.4% overall market return over the past year, where Amazon outpaced the broader US market. However, within its industry, Amazon's performance slightly lagged, as the US Multiline Retail industry returned 16% over the same period. On the earnings front, the introduction of AI-powered services like Trainium2 and the expansion into more stable supply chains may facilitate operational efficiency gains, potentially uplifting revenue and earnings forecasts. However, significant investments and market pressures, such as tariffs and intense competition, could impose challenges on future earnings. The current share price of $185.01 remains below the consensus analyst price target of $239.33, indicating an expectation of further growth and potential value to be realized as Amazon continues to advance its operations and strategic initiatives. Unlock comprehensive insights into our analysis of stock in this financial health report. 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 NasdaqGS:AMZN. This article was originally published by Simply Wall St. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@ Sign in to access your portfolio
Yahoo
09-06-2025
- Business
- Yahoo
Amazon.com (NasdaqGS:AMZN) Offers Prime Members Exclusive Early Superman Screenings
allowed Amazon Prime members exclusive access to early screenings of the new Superman movie, potentially boosting its share price by enhancing member engagement. Additionally, Amazon's tech sector advancements, including a $10 billion investment in North Carolina for data centers and the launch of the AWS Asia Pacific region, align with broader market movements, as major indices saw gains amid ongoing US-China trade talks. A 10.62% rise in Amazon's share price over the past month reflects this, in tune with market trends, bolstered by robust tech performance and economic stability. Buy, Hold or Sell View our complete analysis and fair value estimate and you decide. The best AI stocks today may lie beyond giants like Nvidia and Microsoft. Find the next big opportunity with these 25 smaller AI-focused companies with strong growth potential through early-stage innovation in machine learning, automation, and data intelligence that could fund your retirement. The exclusive early screening of the Superman movie for Amazon Prime members is an initiative that could enhance customer loyalty and engagement. This, alongside Amazon's extensive investments in data centers and AWS expansion, aligns with efforts to bolster revenue through heightened member services and tech advancements. Over the past three years, Amazon shares have seen extraordinary growth, posting a total return of 106.01%, which provides a solid context for the company's overall positive trajectory. In terms of short-term performance, Amazon's shares rose 10.62% in the past month, reflecting a positive reception to recent technological developments and strategic moves. This is despite the more moderate 12.4% overall market return over the past year, where Amazon outpaced the broader US market. However, within its industry, Amazon's performance slightly lagged, as the US Multiline Retail industry returned 16% over the same period. On the earnings front, the introduction of AI-powered services like Trainium2 and the expansion into more stable supply chains may facilitate operational efficiency gains, potentially uplifting revenue and earnings forecasts. However, significant investments and market pressures, such as tariffs and intense competition, could impose challenges on future earnings. The current share price of $185.01 remains below the consensus analyst price target of $239.33, indicating an expectation of further growth and potential value to be realized as Amazon continues to advance its operations and strategic initiatives. Unlock comprehensive insights into our analysis of stock in this financial health report. 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 NasdaqGS:AMZN. This article was originally published by Simply Wall St. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@ Sign in to access your portfolio
