Amazon’s Stock Performance in 2025
Amazon (NASDAQ: AMZN) has struggled in 2025, remaining flat while the S&P 500 has risen approximately 14%. Analysts suggest that while 2025 has been disappointing, 2026 may present opportunities for recovery, especially as Amazon’s operating income valuation has decreased to around 30 times, comparable to peers like Alphabet at 28 times and Microsoft at 26 times.
Amazon’s profitability is primarily driven by Amazon Web Services (AWS), which accounted for 66% of operating income in Q3 despite representing only 18% of total revenue, growing at a rate of 20%. Furthermore, advertising revenue soared by 24% year-over-year in the same quarter, contributing significantly to profit margins. These factors indicate a promising outlook for Amazon as it prepares for potential recovery in 2026.
