Amazon's AWS Growth Could Top Expectations, Analyst Says

Amazon.com (NASDAQ:AMZN) is well positioned heading into its second-quarter results, according to Bank of America, which raised its estimates for the e-commerce and cloud giant on expectations of stronger Amazon Web Services (AWS) growth fueled by artificial intelligence demand.

Amazon Earnings: What Wall Street Will Be Watching

The brokerage reiterated its Buy rating and $310 price forecast, citing improving AI positioning, accelerating AWS growth and continued momentum in generative AI services as potential catalysts for the stock in the second half of 2026.

Bank of America now expects Amazon to report second-quarter revenue of $198.8 billion and operating income of $24.1 billion, above Wall Street consensus estimates of $196.8 billion and $23.6 billion, respectively.

The firm also raised its AWS revenue growth forecast to 33% year over year, up from its prior estimate of 31%, driven by growing demand from Anthropic, OpenAI-powered Bedrock services and broader enterprise AI adoption.

AWS Growth Remains The Key Focus

Analysts expect Amazon’s third-quarter revenue guidance to range between $200.5 billion and $205.5 billion, roughly bracketing Street expectations.

They noted that an earlier-than-usual Prime Day will likely create a headwind for third-quarter retail comparisons after shifting some sales into the second quarter.

The firm said investors should focus less on headline earnings and more on AWS growth, cloud margins, AI backlog expansion and commentary around capital spending.

Bank of America believes Amazon’s cloud business continues to strengthen relative to competitors, supported by Bedrock adoption, Trainium chips and growing AI workloads.

AI Spending And Anthropic Partnership

The brokerage also said Amazon could increase its 2026 capital expenditure outlook to about $210 billion because of higher memory costs and additional AI infrastructure investment.

While that could weigh on near-term sentiment, analysts said stronger cloud demand and improving AI monetization should outweigh those concerns over time.

Bank of America added that Amazon’s expanding relationship with Anthropic could further boost results. The firm estimates Anthropic-related workloads alone could contribute more than $1.5 billion in sequential AWS revenue growth during the quarter, while Amazon’s stake in the AI startup could generate a significant mark-to-market gain.

Wall Street Remains Bullish Ahead Of Earnings

Amazon is scheduled to report second-quarter results on July 30.

Wall Street expects earnings of $1.82 per share, up from $1.68 a year earlier. Revenue is projected to reach $196.02 billion, compared with $167.70 billion in the prior-year quarter.

The stock trades at about 29.6 times forward earnings. Analysts maintain a Buy consensus rating with an average price forecast of $320.10. Recent analyst actions include:

• Wells Fargo reiterated Overweight and raised its price forecast to $322 on July 21.
• KeyBanc maintained Overweight and increased its price forecast to $335 on July 16.
• Wedbush reiterated Outperform with a $293 price forecast on July 16.

Amazon ETF Exposure

Amazon is a major holding in several exchange-traded funds, including:

• iShares Russell Top 200 Value ETF (NYSE:IWX): 8.32%
• Invesco Nasdaq Internet ETF (NASDAQ:PNQI): 9.89%
• ClearBridge Large Cap Growth ESG ETF (NASDAQ:LRGE): 9.29%

Large fund flows into or out of these ETFs can influence Amazon’s share price because of its significant portfolio weighting.

Amazon Price Action

AMZN Stock Price Activity: Amazon.com shares were down 1.47% at $243.91 at the time of publication on Wednesday, according to Benzinga Pro data.

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