The next leg is driven by AWS AI demand and higher-margin monetization density (Ads + services), not just retail share. Upside requires power/capacity execution and limited regulatory impairment.

Amazon can turn today’s AI+logistics capex wave into a higher-quality earnings/FCF profile by (1) selling scarce AI capacity through AWS (custom silicon + clusters), (2) compounding high-margin Ads on commerce and Prime Video intent, and (3) using automation to keep lowering cost-per-unit—supporting a modest multiple lift despite capital intensity.

Owns two scarce rails as cognition commoditizes: trusted distribution (Prime/Marketplace/Ads) and industrial-scale compute (AWS), plus the ops stack to convert AI into lower entropy in physical flows.

Amazon’s upside is less about incremental retail share and more about monetization density: AI infrastructure demand pulls AWS growth while custom chips and better utilization defend margins; Ads expands from on-site search into off-site and video with cleaner measurement; and robotics/software keeps pushing fulfillment efficiency. If those three move together, Amazon can look less like a low-margin retailer and more like a scaled infrastructure-and-attention platform—supporting a modest valuation re-rating despite continued heavy investment.

The binding risks are (1) AI infrastructure economics (power, GPUs, depreciation) staying structurally heavy, (2) regulatory remedies that reduce Prime/marketplace/ads monetization leverage, and (3) intensifying hyperscaler competition turning scale into price cuts instead of profit.

$295.72