• Bernstein lifts Amazon (AMZN)'s price target to $320, maintaining an Outperform rating.
  • AWS revenue growth of 37% and a $25B AI run rate underpin the bullish view.
  • Amazon's 2026 capex is projected at $220B, driven by strong demand and attractive returns.

A Strong Quarter for AWS

Bernstein analysts have raised their price target on Amazon to $320 from $315, keeping an Outperform rating. The move comes on the heels of stronger-than-expected AWS revenue growth of 37% for the year and a robust $25 billion AI revenue run rate. The firm also highlighted Amazon's expanding AI chip business and clear returns on AI investment as key factors.

The note underscores Amazon's aggressive capital expenditure plans, with 2026 capex expected to reach $220 billion. Bernstein sees this as backed by solid demand and attractive payback periods, reinforcing long-cycle investment in AWS and AI infrastructure.

Market Reaction and Analyst Sentiment

Following Amazon's recent earnings, which exceeded expectations, several analysts have raised their targets, clustering in the $310–$350 range. This broad upgrade cycle reflects growing confidence in AWS's role as a primary AI infrastructure beneficiary. "AWS is the crown jewel, and AI is the accelerant," one analyst commented, echoing the sentiment across the street.

We reached out to Amazon for comment but did not receive a response by press time.

Implications for Investors

Amazon's heavy investment in AWS and AI comes with higher capital intensity, but Bernstein argues the payback justifies the spend. The company's expanding AI chip initiatives and partnerships position it well against competitors. However, execution risks remain if demand softens or backlogs linger.

Looking Ahead

With 2026 capex guidance at $220B, Amazon is doubling down on its AI infrastructure. Investors will be watching for tangible returns, but current momentum suggests a durable cloud and AI leadership. As one analyst put it, "The AI buildout is not a question of if, but how fast."

Correction: An earlier version of this article misstated the capex figure; it has been updated to reflect $220B.