/amazon%20holiday%20delivery%20boxes%20by%20Cineberg%20via%20iStock.jpg)
Amazon (AMZN) stock has had a rough ride in 2025 so far, shedding over 17% of its value amid broader market uncertainty and mounting tariff concerns. Moreover, the stock has dropped about 25.6% from its 52-week high.
The market is increasingly wary of a potential consumer spending slowdown, which could put further pressure on the company’s growth trajectory. However, despite the recent pullback in its share price, many Wall Street analysts continue to endorse AMZN stock, and their average price target suggests significant upside potential from current levels.
Amazon Stock Has Multiple Catalysts
While AMZN stock is down, its fundamentals remain strong. The tech giant continues to deliver solid performance across its core business segments, including North America, International, and Amazon Web Services (AWS). Moreover, its advertising division has become a key growth catalyst, driving revenue and profitability. These core pillars continue to provide Amazon with multiple growth engines.
Amazon’s focus on expanding product selection, lowering prices, and enhancing convenience positions it well to consistently deliver durable revenue growth. Amazon is constantly expanding its marketplace with a growing variety of products across various price points, ensuring it continues to cater to a broad range of shoppers. The addition of new brands and hundreds of millions of products has strengthened its marketplace.
A notable recent development was the launch of “Haul” in the U.S., a new initiative that gathers ultra-low-priced products into a single, user-friendly destination. During the Q4 earnings call, management noted that early results had shown strong momentum, suggesting that this new shopping section could help sustain traffic amid economic headwinds.
While the macroeconomic outlook remains uncertain, Amazon’s commitment to affordability, vast selection, and fast delivery is expected to keep customers on its platform.
In 2024, Amazon significantly enhanced its delivery speed. It expanded its same-day delivery network by over 60% to reach more than 140 metro areas. Globally, Amazon fulfilled over 9 billion orders either the same day or the next day. These enhancements elevate customer experience and strengthen Amazon Prime's appeal, helping to boost retention and membership growth.
Cost efficiency remains another priority. Amazon has been streamlining its fulfillment network, cutting down per-unit transportation costs by optimizing its last-mile delivery infrastructure. For the second consecutive year, it reduced global cost to serve per unit while simultaneously improving speed and product availability. As it pushes further into automation, robotics, and inventory management, the company is well-positioned to unlock even more cost savings in the future, which will drive its bottom line.
Amazon’s advertising business continues to scale rapidly. In Q4 alone, ad revenue reached $17.3 billion, putting it on an annual run rate of $69 billion — more than double the $29 billion it generated just four years ago. Sponsored products remain the largest contributor, but the company is also tapping into new revenue streams through its streaming offerings, opening up further monetization opportunities.
Meanwhile, AWS, its cloud computing arm, grew 19% year-over-year in Q4, reaching a $115 billion annualized run rate. While AWS’ growth may fluctuate as businesses adjust their cloud spending, the long-term outlook remains robust. As companies modernize their IT infrastructure, AWS is positioned to be a key beneficiary.
The Bottom Line: Is AMZN Stock Set to Rebound?
Amazon’s diversified business model, cost discipline, and investment in automation and technology give it a solid foundation for long-term growth. AMZN’s leadership in online commerce and cloud computing and thriving digital advertising business put it in a solid position to weather economic turbulence and capitalize on future opportunities.
Wall Street is optimistic, with a consensus “Strong Buy” rating. Their average price target of $263.37 implies an upside of about 45% from current levels.
While AMZN’s long-term growth story looks compelling, challenges like tariffs and a slowdown in consumer spending could delay a swift recovery in its share price.
