NEW YORK, Feb 4, 2026, 14:24 (EST)
- Shares of Amazon dropped roughly 2.5% Wednesday afternoon ahead of the company’s upcoming quarterly earnings release.
- Thursday’s fourth-quarter results will be the next big event for the stock, focusing heavily on Amazon Web Services and AI-related expenses.
- A Raymond James analyst lowered his price target, noting that AI execution will probably determine the stock’s trajectory in 2026, despite solid near-term fundamentals.
Amazon.com shares dropped roughly 2.5%, slipping to $232.68 in Wednesday afternoon trading. That decline outpaced the broader market’s retreat, with the Nasdaq-100 tracker QQQ falling around 2.1%, as investors prepared for the company’s quarterly results.
Amazon plans to release its fourth-quarter results Thursday, with the earnings call set for 5:00 p.m. ET, per the company. Investors will be keenly watching for updates on spending strategies as Big Tech funnels investment into data centers and chips to back AI services.
Zacks Investment Research reports Amazon expects net sales between $206 billion and $213 billion this quarter, signaling growth of 10% to 13%, boosted by roughly 1.9 percentage points from currency fluctuations. Their consensus sales estimate stands at $211.56 billion, with earnings per share projected at $1.98. AWS revenue is forecasted at $35.02 billion, marking a 21.6% increase year-over-year.
Raymond James analyst Josh Beck cut his price target on Amazon to $260 from $275 on Tuesday, labeling the stock a “Tweener” in the firm’s “AI Stack” framework — a rough gauge of who’s best placed for the AI buildout. Beck said he remains “constructive heading into Q4” but flagged that the “AI narrative is likely the primary factor” driving the shares over the next year. He projects AWS growth of 22% to 23% in 2026, beating Wall Street’s expectations, and includes AI-driven revenue from accelerator chips, GPUs, and Amazon’s Bedrock AI platform. Investing.com India
The same note highlighted “agentic commerce” — software agents capable of searching, comparing, and purchasing for customers — as a potential long-term growth driver, but also a risk if it alters shopping habits or chips away at market share. Beck put the opportunity at around $400 billion by 2030, while cautioning that even a slight drop in e-commerce market share could drag core retail growth roughly 1% below Street forecasts. Investing.com India
DailyForex analyst Adam Lemon, ahead of Tuesday’s session, flagged a bullish setup with a long-entry zone roughly between $239 and $246, and a stop-loss near $225. He noted the daily chart remains confined within a rising price channel.
Options pricing indicated traders are bracing for a sharp move after Amazon’s earnings, with shares expected to swing about 7% up or down by week’s end, according to Investopedia’s analysis of options activity. The site also referenced Visible Alpha estimates projecting quarterly revenue near $211.55 billion and earnings per share around $1.97.
AWS goes head-to-head with Microsoft’s Azure and Alphabet’s Google Cloud, and investors tend to punish stocks when cloud growth or AI spending misses expectations. On Wednesday afternoon, Microsoft’s shares climbed roughly 1.4%, while Alphabet’s dropped around 2.6%.
Amazon faces a risk here: the market has priced in a robust cloud quarter and upbeat guidance. Should AWS growth fall short of those high expectations — or if management hints at more spending with no clear timeline for returns — the stock could still slide despite beating earnings.
Thursday’s report will probably boil down to a handful of points: AWS growth, ad momentum, and management’s take on AI spending through 2026. Investors will be tuned in for any sign that the AI narrative is moving beyond infrastructure buildout toward revenue that clearly boosts margins.
