Amazon(US:AMZN) ZACKS·2025-09-02 16:25Core Insights - Amazon is significantly enhancing its cloud strategy as AWS reports an 18% year-over-year growth, reaching $30.8 billion in Q2 2025, contributing approximately $10.2 billion in operating income, highlighting AWS's critical role in Amazon's profitability [1][10] AWS Expansion and Investment - The introduction of the AWS Asia Pacific (New Zealand) Region, supported by a NZ$7.5 billion investment and three Availability Zones, establishes a renewable-powered hub in APAC, addressing needs such as low latency and data residency compliance, particularly for sectors like finance and healthcare [2] - AWS has committed to training 100,000 New Zealanders through a Memorandum of Understanding (MoU), aligning with national priorities and promoting local adoption of cloud services [3] - AWS plans to add 10 new Availability Zones and three additional Regions in Chile, Saudi Arabia, and Europe, aiming to capture a share of the projected $1.9 trillion global Cloud Computing Market by 2030, which is expected to grow at an 18.7% compound annual growth rate [4] Competitive Landscape - Microsoft Azure has emerged as a strong competitor, achieving over $75 billion in revenues for fiscal 2025, growing more than 34% year-over-year, and expanding its data center presence significantly [6] - Google Cloud Platform is also gaining traction, with revenues increasing by 31.7% year-over-year to $13.62 billion in Q2 2025, bolstered by partnerships and proprietary hardware [7] Financial Performance and Valuation - Amazon's stock has increased by 4.3% year-to-date, underperforming compared to the Zacks Internet – Commerce industry and the Zacks Retail-Wholesale sector [8] - The forward 12-month Price/Sales ratio for Amazon is 3.23X, which is higher than the industry average of 2.3X, indicating that the stock may be overvalued [11] - The Zacks Consensus Estimate for Amazon's 2025 earnings is $6.73 per share, reflecting a 21.7% increase from the previous year [14]