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On Tuesday, UBS analyst Stephen Ju adjusted the price target for Amazon.com (NASDAQ:AMZN) to $253.00, down from $272.00, while reaffirming a Buy rating on the company’s shares. The revision comes ahead of Amazon’s first-quarter 2025 earnings release scheduled for May 1. With a current market capitalization of $1.99 trillion and a P/E ratio of 33, Amazon continues to command premium valuations. According to InvestingPro analysis, the stock is currently trading near its calculated Fair Value, with 12 additional exclusive insights available to subscribers. Ju’s report indicates a recalibration of UBS’s model, accounting for factors beyond foreign exchange rates, including potential tariff-related demand impacts due to price sensitivity.
According to Ju, data from the Department of Commerce shows that a significant portion of goods purchased in the United States contains 55-71% imported content, with the exception of food and beverages, which have a lower imported content of 22%. These figures have influenced UBS’s expectations for Amazon’s global gross merchandise volume (GMV) growth, which is now projected at 7.6% for 2025, down from a previous forecast of 10.1%. This projection comes as Amazon has demonstrated strong revenue growth of 11% over the last twelve months, generating total revenue of $638 billion. InvestingPro subscribers can access detailed revenue forecasts and growth metrics in our comprehensive Pro Research Report, one of 1,400+ company deep-dives available on the platform. The 2026 growth estimate has also been adjusted to 7.2% from 10.3%, with a predicted recovery to around 10% in 2027.
The report further details adjustments to Amazon Web Services (AWS) growth predictions for 2025, which remain below consensus, while estimates for the Advertising segment have decreased due to previously noted headwinds. As a result, UBS now forecasts a 1% decrease in Amazon’s 2025 revenue and a 7% decrease in EBIT. The projections for 2026 and 2027 also show decreases in revenue and EBIT, with reductions of 3% and 11% for 2026, and 3% and 10% for 2027, respectively.
Ju also mentioned that the level of capital intensity for both Amazon’s e-commerce operations and AWS is expected to remain consistent, with capital expenditures estimated at approximately $33 billion and $71 billion, respectively. No changes are anticipated in the company’s expectations for capital expenditure levels.
Finally, the analyst highlighted investor expectations for Amazon’s revenue to be around $155 billion, at the higher end of the guidance range of $151 billion to $155.5 billion. Operating income (OI) is also expected to be at the higher end of the provided guidance range of $14 billion to $18 billion. The strong analyst consensus, as tracked by InvestingPro, maintains a highly bullish outlook on Amazon, with price targets ranging from $195 to $287 per share. The company’s robust financial health score and strong profit metrics suggest continued momentum heading into the earnings announcement.
In other recent news, Amazon has initiated the deployment of its Project Kuiper broadband internet constellation by launching its first 27 satellites from Florida. This marks a significant milestone in the $10 billion initiative aimed at providing global broadband internet. In related developments, Citizens JMP analysts have maintained their Market Outperform rating for Amazon, highlighting the company’s substantial investments in Project Kuiper, which have impacted its operating income margin. The analysts predict that Project Kuiper might start generating revenue in the second half of 2026, later than initially expected.
Meanwhile, Citi analysts have reiterated a Buy rating on Amazon stock with a $225 price target, expressing optimism about the company’s performance in upcoming quarters. They are particularly focused on the demand for Amazon Web Services and the impact of tariffs and advertising on the company’s financial trajectory. Additionally, Amazon is reportedly maintaining its capital expenditure expectations for the year despite broader economic challenges. These recent developments reflect Amazon’s strategic investments and ongoing efforts to expand its market presence.
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