A recent TD Cowen report forecasts that Amazon’s advertising division could more than double its current revenue, reaching over $140 billion by 2030. This projection is underpinned by the unit’s gross margins, which consistently exceed 80 percent, and an expanding suite of demand-side tools that secure higher cost-per-click rates than traditional e-commerce ads. With ads now representing roughly 10 percent of overall revenues and growing faster than the core retail business, investors are eyeing the division as a key driver of operating margin expansion over the next five years.

Analysts rate Amazon a Strong Buy, forecasting a split-of-the-difference target of $350 per share by the end of 2026—a 22 to 31 percent upside. This thesis rests on AWS re-accelerating to over 20 percent year-over-year growth, fueled by its shift from basic AI hosting to agentic AI infrastructure powered by Trainium 3 chips. A $200 billion AI backlog, coupled with AWS’s cost-efficiency advantage from in-house silicon, underpins a sum-of-the-parts enterprise value estimate of $3.3 trillion, decoupling cloud profitability from retail cyclicality.

In January 2026 Amazon unveiled Alexa+ Web, a browser-based AI assistant integrated at no additional cost into its Prime membership. By offering a workflow tool that users deploy daily for drafting emails, summarizing documents and organizing schedules, the initiative aims to lower Prime churn and justify an upcoming membership price increase. Early data show Prime engagement metrics increasing by double digits, and portfolio managers believe this move could boost average revenue per user by $20 to $30 annually while providing a tangible use case for Amazon Web Services’ consumer-grade AI scalability.