Amazon is entering 2026 with renewed enthusiasm from Wall Street, as analysts anticipate a recovery in its cloud and artificial intelligence sectors following a period of underperformance. In 2025, Amazon’s stock rose just 6%, lagging behind the S&P 500’s increase of 18%, primarily due to slower growth in Amazon Web Services (AWS) and delayed monetization of AI technologies.
Mark Mahaney from Evercore ISI has designated Amazon as his “top pick” for 2026, predicting a resurgence in its AWS performance, alongside a rise in AI chip sales and advertising revenue. He forecasts that AWS income could increase by over 20% annually, driven by the expansion of Trainium processors and enhanced AI workload capacity.
Analysts are optimistic about the demand for cloud services, with Goldman Sachs’ Eric Sheridan maintaining a Buy rating with a target price of $290, citing expected growth in the sector. Meanwhile, Doug Anmuth of JPMorgan highlighted a potential $38 billion cloud agreement with OpenAI, which he predicts could see a significant uptick of 31%.
Justin Post from Bank of America, also holding a Buy rating with a price target of $303, noted that Amazon’s $10 billion investment in OpenAI could bolster AWS’s competitiveness and stimulate wider adoption of its AI infrastructure. Despite workforce reductions made in late 2025, experts assert that Amazon’s foundational strengths remain intact, as the company continues to develop AI infrastructure while simultaneously enhancing its advertising and retail automation capabilities. The overarching sentiment is one of cautious optimism, indicating a potentially bright future for Amazon as it navigates these evolving technology landscapes.