Amazon’s $300 Billion Jump Puts Stock Back in AI Conversation

Core Viewpoint - Amazon's cloud-computing business, Amazon Web Services (AWS), has shown signs of recovery with the fastest quarterly growth since 2022 and a significant $38 billion deal with OpenAI, leading to a notable increase in stock value and market capitalization [2][3]. Group 1: AWS Performance - AWS has experienced a resurgence in growth, alleviating previous concerns about losing market share to competitors like Google Cloud and Microsoft Azure [4]. - The recent earnings results indicate that the acceleration in AWS growth could be sustainable, prompting investors to reconsider Amazon's position in the AI sector [3]. - Prior to the recent rally, AWS's revenue growth had been slowing, which negatively impacted Amazon's stock performance [4]. Group 2: Stock Performance and Valuation - Amazon's stock gained 12% in four trading days, adding approximately $300 billion in market value and reaching its first record since February [2]. - Despite the recent rally, Amazon's year-to-date performance remains below that of the S&P 500 and Nasdaq 100, with a 14% gain compared to 16% and 22% respectively [5]. - Amazon's current valuation at 27 times projected profits is significantly lower than its average of 47 times over the past decade, indicating potential for multiple expansion as AWS gains momentum [6][7].