Amazon's stock (NASDAQ: AMZN) has shown strong early performance in 2026, with shares up over 6.7% year-to-date, already surpassing its modest 5% gain from all of 2025. This renewed momentum comes as the tech giant prepares to report its fourth-quarter fiscal 2025 earnings after the market closes on Thursday, February 5.
The company reported a robust 36% year-over-year increase in earnings per share (EPS) to $1.95 for its most recent quarter, significantly exceeding analyst estimates of $1.57. This continues a trend of outperformance, as Amazon has beaten earnings expectations for eight consecutive quarters and has missed revenue estimates only once in the past two years.
Wall Street maintains an overwhelmingly bullish stance. Of the analysts covering the stock, 36 out of 37 recommend a Buy rating, with an average 12-month price target of $297.29, implying a 23.43% upside from recent prices around $240.85. This sentiment has been bolstered by recent analyst upgrades.
UBS analyst Stephen Ju raised his price target to $311, citing the potential for Amazon Web Services (AWS) revenue to double by 2028, which could add roughly $20 billion in extra cash flow. Ju also updated his capital expenditure forecast, projecting total capex through late 2027 at $344 billion to support AWS's plan to double its capacity.
Similarly, Citizens JMP analyst Andrew Boone lifted his target to $315, driven by reports that AI firm Anthropic raised its 2026 revenue forecast to at least $17 billion. As Anthropic's primary computing partner, Amazon is expected to capture the majority of this spending, estimated at over $12 billion on training AI models and approximately $7 billion on inference, through AWS.
Key business segments are showing accelerated growth. AWS sales growth increased from 17% in the first half of 2025 to 20% in Q3 2025, with analysts expecting this re-acceleration to continue into 2026 driven by AI infrastructure demand. Meanwhile, Amazon's advertising business grew 24% year-over-year in Q3 to $17.7 billion, becoming a significant contributor to profitability.
For the upcoming Q4 report, analysts expect adjusted EPS of $1.97 on revenue of $211.44 billion, representing a 12.6% year-over-year sales increase. Investors will closely watch AWS performance against competitors, capital expenditure guidance for AI, advertising revenue growth, and operating margins across all segments.
